Ex Ante Costs of Violating Absolute Priority in Bankruptcy

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Bankruptcy Codes and Innovation (2009, unknown): “They examine how the extent of dependence of an industry on external finance differentially impacts industries’ growth rates depending upon a to greater undertaking of risk has been made before, e.g., see Bebchuk (2002).”
Corporate Financial Distress and Bankruptcy: A Survey (2012, background): “Bebchuck (2002) shows that APR violations can increase the bias of equity holders’ decisions in favor of riskier investments, because such violations increase what the equity holders would receive in bad times, and hence, the fraction of the downside risk borne by the debt holders.”
Social Capital and Debt Contracting: Evidence from Bank Loans and Public Bonds (2017, unknown): “These dealings include overinvestment (Galai and Masulis (1976)), claim dilution (Bebchuk (2002)), and accounting manipulation to avoid covenant violations (DeFond and Jiambalvo (1994)).”
How do bankruptcy laws affect entrepreneurship development around the world (2011, background): “Our findings suggest that there may be important adverse selection issues associated with keeping a failing firm's managers in place—themanagers who are associated with an entrepreneurial firm's financial distress may not always be the best managers to continue to manage a firm (Bebchuk, 2002).”
Can the Trade-off Theory Explain Debt Structure? (2007, unknown): “25 Bebchuk (2002) provides a survey of this literature.”