| Article ID | Journal | Published Year | Pages | File Type |
|---|---|---|---|---|
| 5054807 | Economic Modelling | 2013 | 8 Pages |
Abstract
⺠We examine the special convertible bonds whose conversion prices can be reset. ⺠Resettable convertibles can help firms reduce liquidity cost. ⺠But the adverse selection problem may be exacerbated in some cases. ⺠Firms can avoid the problem through costly signaling with fixed-price convertibles. ⺠Pooling and separating equilibria may coexist for some parameter values.
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Economics and Econometrics
Authors
Junfeng Qiu, Yongli Zhang,