Macroeconomic determinants of personal bankruptcies

Outlines trends in UK personal bankruptcies and relevant research; and explores the reasons for their dramatic rise since 1990. Explains the process of econometric analysis used to interpet the statistics and presents the results, which support the argument that higher indebtedness leads to more bankruptcies, either through higher gearing or declining credit standards. Finds that both unemployment and real disposable income affect the bankruptcies ratio in the short run, but the effect of interest rates is smaller. Briefly considers the implications of the findings.