Pavel Zryumov

Short-Term Debt Overhang with Giulio Trigilia and Kostas Koufopoulos
R&R at the RFS (2nd round) February 2026

We consider a dynamic asymmetric information model where firms face multiple investment opportunities and their capital structure is endogenous at all times. We identify a new economic force (distinct from Myers (1977)) which leads firms to issue short-term debt and subsequently underinvest in growth options. This force, which arises at the optimal mechanism and is time-consistent, generates several new testable predictions. Strikingly, we find that greater retained earnings, or cash, can reduce the investment in positive net present value projects by firms with intermediate credit ratings, and that these firms are the most likely to issue short-term debt.

Lending Competition and Funding Collaboration with Yunzhi Hu
R&R at the RFS February 2026

We examine competition and collaboration between banks and fintech firms in a market with adverse selection. Banks have cheaper funding, while fintechs have better screening technology. Our innovation is to allow the bank to lend to the fintech, i.e., to finance its competitors. This partnership affects competition through two channels: the funding cost channel, which lowers fintech funding costs and operates through the winner's curse effect when adverse selection is severe and cost pass-through when it is mild, and the toe-hold channel, which reduces bank competition incentives. Lenders collaborate when adverse selection is severe but compete when it is mild. While partnership funding always benefits the fintech, it increases the bank's profits only when adverse selection is severe and benefits the borrowers only when adverse selection is mild.

Data versus Information Sales under Financial Constraints with Dmitry Orlov and Andy Skrzypacz
August 2025

We study a dynamic problem of selling data without commitment to a budget-constrained receiver. The sender has access to a data-generating process, informative about a fundamental state, and can sell it either as granular observations (raw data) or summary statistics (information). Properly designed, such statistics ensure the residual uncertainty declines predictably along with the receiver's budget, supporting efficiency under gradual information sales. In contrast, selling raw data poses a risk that future observations increase residual uncertainty, exceeding the receiver's remaining budget. Consequently, selling data is inefficient if the fundamental is discrete and requires excess budget if the fundamental is non-Gaussian.

Exchanging Information with Dmitry Orlov and Andy Skrzypacz
September 2025

We analyze a class of dynamic games of information exchange between two players. Each agent possesses information about a binary state that is of interest to the other player and cares about the other player's actions. Preferences are additively separable over own and the other player's actions. We fully characterize the set of equilibrium payoffs that can be sustained in such games and construct equilibria that achieve those payoffs. We show that gradual information exchange dominates static (one-shot) communication. Moreover, the whole set of outcomes that Pareto-dominate static communication can be supported in equilibrium.

Cream Rises First: Endogenous Entry and Adverse Selection over the Cycle
June 2026
Subsumes working paper "Dynamic Adverse Selection: Time Varying Market Conditions and Endogenous Entry"

I study how endogenous asset creation and a time-varying cost of capital jointly shape liquidity, the quality of financed assets, and efficiency in a dynamic market with adverse selection. When gains from trade are low, owners of good assets delay sale to signal quality, and the market is illiquid. An improvement in conditions triggers a wave of deals that, contrary to standard theories, opens with the highest-quality assets, as withheld inventory clears at once; quality then deteriorates as high prices attract low-grade entrants. Illiquidity is both a cause of and a cure for inefficiency: delay screens entrants and restores first-best origination without intervention.