Bankruptcy: Is It Enough to Forgive or Must We Also Forget?

Bankruptcy: Is It Enough to Forgive or Must We Also Forget?

In many countries, lenders are not permitted to use information about past defaults after a specified period of time has elapsed. We model this provision and determine conditions under which it is optimal. We develop a model in which entrepreneurs must repeatedly seek external funds to finance a sequence of risky projects under conditions of both adverse selection and moral hazard. We show that...

To Forgive or Not to Forgive: An Analysis of U.S. Consumer Bankruptcy Choices

C urrent U.S. bankruptcy law has two separate bankruptcy procedures, known as Chapter 7 and Chapter 13. When a debtor files for bankruptcy under Chapter 7, he or she must give up all assets not legally sheltered from creditor seizure in exchange for a discharge of almost all preexisting debts. Under Chapter 13, a debtor may keep all property in exchange for a promise to pay all or some specifie...

Tackling HIV in MENA: Talk Is Not Enough–It Is Time for Bold Actions: A Response to Recent Commentaries

Must We Value Life to Have a Right to It?

In her recent article "Death, Mis­­ fortune, and Species Inequality,"l Ruth Cigman gives clear, careful expression to an argument which seems well on its way to becomi ng a classic among opponents of animal rights. 2 Cigman's argument runs as follows: A right to X entails the right to be protected against certain actions which will result in the misfortune, or possible misfortu ne, of not-X. A ...

Why Is It So Difficult to Optimally Choose Innovation? Lest We Forget the Real World

In order highlight the non-steady state and real world dynamics associated with competitive innovation we develop a model involving choice of product quality in a simple duopoly characterised by two key departures from the dominant framework of quality ladder: first, we consider firms who refrain from maximising short-run profits. Instead, firms are started their function or action by their lon...