Maturity walls occur when a majority of a firm's debt comes due within a short period (1-2 years), increasing rollover risk. Despite this, 47% of non-financial firms have them. This paper understands why firms adopt maturity walls and its implications for the aggregate economy. Using Mergent FISD data, I provide evidence that firms incur substantial fixed costs in bond issuance. I develop a dynamic model where firms decide each period the level and dispersion of their debt payments. The main trade-off is rollover risk from maturity walls in the presence of costly equity injections, versus the lower issuance costs incurred from infrequent rollovers. I estimate the model to match both aggregate and distributional moments of firms' debt payment schedules. Maturity walls increase credit spreads by 21% (36 bps) and default rates by 25% (30 bps). Lowering issuance costs reduces the adoption of maturity walls, but increases firms credit risk. Moreover, omitting maturity walls could underestimate the transmission of a credit market freeze up to 60%.

When do temporary cash flow shocks leave permanent scars on firms? I study this question

using weather-driven suspensions of Italian public construction contracts, which generate

sharp, exogenous and well-defined cash flow shocks: all payments to the firm are legally

halted, while her cost obligations persist. Using a staggered difference-in-differences design

matching treated firms to not-yet-treated controls on size, location and public sector reliance,

I find that contract suspensions reduce firm sales by 30%, employment by 15% and total

assets by 19%. These effects are not transitory- they deepen over four years, even when the

suspension itself lasts at most one year. The scarring is driven by a within-firm amplification

mechanism: the cash flow shock propagates from suspended to unsuspended contracts, as

working capital constraints prevent firms from financing the upfront expenditures needed to

keep their other projects on track. Payment delays on unsuspended contracts rise by 15%, and

inventories are depleted as firms exhaust their buffer stocks. Crucially, contract suspensions

disrupt cash flows without necessarily damaging the firm’s physical assets, allowing me to

isolate the effects of a pure earnings shock from any impairment of collateral values. The

results point to two complementary frictions: a working capital constraint that generates the

within-firm propagation — as cash flow losses distort input allocation and reduce output,

perpetuating the constraint — and an earnings-based borrowing constraint that prevents

fiirms from accessing external finance to arrest the cycle.

Banks have a significant funding-cost advantage if their liabilities are protected by bailout guarantees. We construct a corporate finance-style model showing that banks can exploit this funding-cost advantage by just intermediating funds between investors and ultimate borrowers, thereby earning the spread between their reduced funding rate and the competitive market rate. This mechanism leads to a crowding-out of direct market finance and real effects for bank borrowers at the intensive margin: banks protected by bailout guarantees induce their borrowers to leverage

excessively, to overinvest, and to conduct inferior high-risk projects. We confirm our model predictions using U.S. panel data, exploiting exogenous changes in banks’ political connections, which cause variation in bailout expectations. At the bank level, we find that higher bailout probabilities are associated with more wholesale debt funding and lending, and confirm this lending behavior at the bank-county level and within bank-firm relationships. At the firm level, we find that indirectly guaranteed firms increase their leverage, engage in value-destroying M&A activity and overinvestment, and experience a decline in productivity, highlighting the systemic implications of bailout induced distortions.