In the last decade, there was a rapid growth in the availability and use of credit for Brazilian companies. Until recently, the decision to grant credit was based on human trial to evaluate the risk of insolvency. Increased demand from companies for credit has led to the use of more accurate models for bankruptcy prediction. In recent years much progress has occurred in the process of drawing u...

Power grids, populations, large companies, banking systems, and other collections of numerous and highly interconnected elem-ents are subject to what George Papanicolaou of Stanford University calls “systemic risk.” As he explained in an invited talk at the 2012 SIAM Annual Meeting, each such system is susceptible to a type of “contagion” that, though triggered by seemingly unimportant events, ...

We analyze liability rules in a setting where injurers are potentially insolvent and where negligence standards may deviate from the socially optimal level. We show that proportional liability, which sets the measure of damages equal to the harm multiplied by the probability that it was caused by an injurer’s negligence, is preferable to other existing negligence-based rules. Moreover, proporti...

A The auxiliary problem 1 A.1 Notation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 A.2 Immediate liquidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 A.3 Value of a barrier strategy . . . . . . . . . . . . . . . . . . . . . . . . . . 3 A.4 The optimal barrier . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 A.5 Verification . . . . . . ....

It has been pointed out in the macroeconomics and financial risk literature that risk-sharing by diversification in a financial network may increase the systemic risk. This means roughly that while individual agents in the network, for example banks, perceive their risk of default or insolvency decrease as a result of cooperation, the overall risk, that is, the risk that several agents may defa...

Following the Great Recession, most states’ unemployment insurance (UI) trust funds became insolvent, requiring the states to borrow from the U.S. Treasury to finance benefit payments. This article describes the basics of UI financing and reviews the origins of the financial crisis facing the federal-state UI system. It then examines the main components of the UI payroll tax—the taxable wage ba...

Economic efficiency is improved in the presence of an implemented risk management program of the insurer. Risk management requirements are imposed by regulators to reduce the insurers’ insolvency risk, as well as to improve the insurance market stability. We extend the classical analysis on optimal insurance design to the case when the insurer implements regulatory requirements (Value-at-Risk)....

The paper examines the main issues involved in translating domestic bankruptcy procedures to the sovereign context. It considers some of the principles by which domestic bankruptcy procedures operate, and the extent to which they apply to international lending. Two recent proposals are considered in more detail, that of Krueger (A New Approach to Sovereign Debt Restructuring) and that of Pettif...

In the article problem of correlation administrative and disciplinary responsibility insolvency officers. Legal regulation officers was analyzed compared. The author argues possibility removing from sphere relations, which are subject control self-regulatory organizations arbitration managers.