This paper investigates the impact of debt covenant protection on the cross section of equity returns with a firm-level covenant index and four sub-indices. We find that firms with weaker covenant protection (lower covenant index levels) earn significantly higher risk-adjusted equity returns...

Considering the existence of strong policy intervention in China, this paper introduces policy uncertainty into standard Real Options framework, and provides a theoretical explanation for the land development decision in an emerging market. Based on survival analysis, we examine the determinants...

This paper examines the effects of bond liquidity on firms' investments. We postulate that bond liquidity increases firms' investment opportunities by reducing the cost of capital and improving access to financing. Using the exogenous variation in liquidity generated by the introduction of...