outside funds. If bankruptcy law favors reorganization over liquidation, the managers’s value of debt for a given investment …’s policy through the contingent transfer of control to external investors with high relative liquidation value. External …

a hypothesis to explain why Spain has one of the world’s lowest business bankruptcy rates, even during the current … the Spanish bankruptcy system relative to that of an alternative insolvency institution, the mortgage system, and the … unattractiveness of the personal bankruptcy law …

The paper warns about the potential efficiency losses associated with low business bankruptcy rates (number of firms … filing for bankruptcy as a proportion of the total stock of firms) and shows that welfare could be improved by increasing the … protection of creditors in the bankruptcy system. These ideas are illustrated with the Spanish case. The paper also predicts a …

Small businesses, the majority of Spanish fi rms, rarely fi le for formal bankruptcy, and this has been the case even … during the current economic crisis. This suggests that bankruptcy law has a limited role to play in the distress of small fi … rms. We propose an explanation based on two premises: (i) bankruptcy procedures are more costly and drawn out than the …