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Determinants of Financial Distress: What Drives Bankruptcy in a Transition Economy? The Czech Republic Case

Lízal, Lubomír - William Davidson Institute, University of Michigan - 2002

The main factors influencing the probability of bankruptcy are analyzed on Czech Republic 1993-1999 firm data. Basic … models of the bankruptcy are compared: neoclassical, financial and corporate governance. The corporate governance hypothesis …

Persistent link: https://www.econbiz.de/10005784676

Revisiting Hungary's Bankruptcy Episode

Bonin, John P.; Schaffer, Mark E. - William Davidson Institute, University of Michigan - 1999

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 … bankruptcy framework not connected to the automatic trigger provide the more important lessons. In particular, it is possible to …

Persistent link: https://www.econbiz.de/10005677576

Passive Creditors

Schoors, Koen; Sonin, Konstantin - William Davidson Institute, University of Michigan - 2005

Creditors are often passive because they are reluctant to show bad debts on their own balance sheets. We propose a simple general equilibrium model to study the externality effect of creditor passivity. The model yields rich insights in the phenomenon of creditor passivity, both in transition...

Persistent link: https://www.econbiz.de/10005677615

The Failure of Government-led Program of Corporate Reorganization in Romania

Djankov, Simeon; Ilayperuma, Kosali - William Davidson Institute, University of Michigan - 1997

We provide the first comprehensive cost-benefit analysis of government-led reorganization programs for financially distressed firms in transition economies. The study is based on empirical evidence on the programs in Albania, Arinenia, Bulgaria, FYR Macedonia, Romania, Kazakhstan, Kyrgyz...

Persistent link: https://www.econbiz.de/10005489895

Quality of Institutions, Credit Markets and Bankruptcy

Hainz, Christa - William Davidson Institute, University of Michigan - 2005

The number of firm bankruptcies is surprisingly low in economies with poor institutions. We study a model of bank-firm relationship and show that the bank’s decision to liquidate bad firms has two opposing effects. First, the bank receives a payoff if a firm is liquidated. Second, it loses the...

Persistent link: https://www.econbiz.de/10005651481