Individual bankruptcy

Author's Personal Copy Consumer Bankruptcy and Default: the Role of Individual Social Capital

In this paper, we empirically assess the role of individual social capital on personal bankruptcy and default outcomes in the consumer credit market. After controlling for a borrower’s risk score, debt, income, wealth, and legal and economic environments, we find that default/bankruptcy risk rises and then falls over the lifecycle, while a borrower who owns a home or is married has a lower risk...

Bankruptcy Judges and Bankruptcy Venue: Some Thoughts on Delaware

Selling Innovation in Bankruptcy∗

We construct a comprehensive dataset of patent sales conducted by all US public firms in Chapter 11 bankruptcy from 1981 to 2012. We document that 40% of firms sell, on average, 18% of their patents during bankruptcy reorganizations. Innovation sales concentrate in the first two quarters after bankruptcy filing. Firms sell more redeployable and liquid patents, as opposed to selling underexploit...

Revisiting Hungary’s Bankruptcy Episode

We take a retrospective look at Hungary’s experiment with a particularly draconian bankruptcy law. For an eighteen-month period in 1992–93, the Hungarian bankruptcy code contained an unusual automatic trigger that required the managers of firms that held overdue debts of any size to any creditor to initiate reorganisation or liquidation proceedings to avoid prosecution under the civil code. We ...

Who Files for Bankruptcy

While prior papers have examined the impact of state exemption and garnishment laws on the average household, this paper is the first to examine their heterogeneous impact. In my theoretical model, households choose between three options: repayment, bankruptcy, and informal bankruptcy (non-repayment without the benefit of the formal bankruptcy process). The model makes two predictions about the...