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Contingent Control Rights and Managerial Incentives: The Design of Long-term Debt

Fluck, Zsuzsanna
NYU Faculty Digital Archive · Papers
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Enterprises, small or large, rely heavily on long-term financing arrangements to fund their operations. However, it has proved difficult for financial theory to justify the use of long-term contracts when the manager has the ability to divert or manipulate the cash flows, and when it is prohibitivel
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