• Lucy White


Good cop, bad cop: Complementarities between debt and equity in disciplining management, Lucy White, October 2014, Paper. "We demonstrate an inherent conflict between ex ante efficient monitoring and liquidation decisions by outside claimholders. We show it can be useful to commit to inefficient liquidation when monitors fail to produce information: this provides stronger incentives to monitor. The implication for firm capital structure is that more information is generated about firm prospects - and hence firm value increases - when a firm's cash flow is split into a 'safe' claim (debt) and a 'risky' claim (equity) compared to..." Link