Elif DALKIR

Elif DALKIR

Associate Professor, Department of Economics, Faculty of Arts, UNB Fredericton Campus

Elif holds a multidisciplinary Ph.D. in mathematics and economics. She has a strong foundation in pure mathematics. In particular, she is an expert in game theory. Her research areas include corporate governance, strategic voting, and most recently, private equity. She provides answers to crucial problems in economic theory and finance theory by formulating solutions using game theory and mathematical modeling.

Selected Publications


Abstract of most recent work in progress

Agency Cost of Debt and Pay-in-kind Debt Contracts

ABSTRACT

The most junior debt used by private equity investors often takes the form of pay-in-kind (PIK) securities. The original PIK contracts in 1980s required interest to be paid not in cash but in newly issued debt contracts with identical features. More recently private equity investors started issuing PIK Toggles which give the borrower to have option to choose between cash and PIK interest payments. We show that this new contract is optimal and solves agency problems as well as adverse selection.