We study whether industrial firms risk-shift in response to distress risk increases induced through hurricane strikes. Using new proxies capturing deliberate managerial decisions about the risk of a firm’s operating segment portfolio, differences tests suggest that hurricane strikes prompt moderately, but not highly, distressed firms to skew their asset mixes toward riskier segments by shutting down low-risk, high-average-Q segments. In turn, the moderately distressed firms observe abnormally high failure rates after a hurricane strike. Employing covenant violation data, we offer further evidence that creditor control prevents highly distressed firms from raising their risk. Our conclusions extend those of other studies by suggesting that moderate distress risk levels can lead the managers of industrial firms to not only engage in risk-taking, but, in fact, in risk-shifting.

中文翻译：

---

在风暴的道路上：困境中的风险会导致工业企业转移风险吗？*

我们研究了工业公司是否应对飓风罢工引发的困境风险增加而转移风险。使用新的代理人捕获有关公司经营部门投资组合风险的蓄意管理决策，差异测试表明，飓风袭击适度但不严重地促使受困企业通过关闭低风险，高平均水平将资产组合偏向风险较高的部门-Q段。反过来，遭受中等程度困扰的企业在遭受飓风袭击后观察到异常高的失效率。利用违反公约的数据，我们提供了进一步的证据，表明债权人的控制可以防止陷入困境的公司提高风险。我们的结论扩展了其他研究的结论，认为适度的困境风险水平可能导致工业企业的管理者不仅从事冒险，而且