Series: IMF Working Papers
Author(s): Se-Jik Kim , and Mark Stone
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 01 October 1999
Keywords: corporate leverage, bankruptcy, capital sales, east Asian crisis, output contractions, capital inflows, capital stock, bonds, gross domestic product, cost of capital
Different levels of corporate leverage are used in this paper to help explain the wide range of post-crisis output adjustment across East Asia. In the model developed here, highly leveraged firms facing a cutoff of...