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Debt recovery in firm liquidations : do liquidation trustees matter?

Cepec, Jaka; Grajzl, Peter; Zajc, Katarina - 2016

Insolvency systems play a crucial role in protection of creditor rights, yet micro-level empirical evidence on the … functioning of insolvency regimes worldwide is sparse. We investigate whether creditors' recovery of outstanding claims, a measure … of ex-post efficiency of an insolvency regime, depends on the characteristics of the trustee delegated the administration …

Persistent link: https://www.econbiz.de/10011518156

The impact of delay : evidence from formal out-of-court restructuring

Srhoj, Stjepan; Kovač, Dejan; Shapiro, Jacob N.; … - 2021

Bankruptcy restructuring procedures are used in most legal systems to decide the fate of businesses facing financial hardship. We study how bargaining failures in such procedures impact the economic performance of participating firms in the context of Croatia, which introduced a "pre-bankruptcy...

Persistent link: https://www.econbiz.de/10012603137

Advantageous smallness in contests

Amegashie, J. Atsu - 2021

A standard result in contests is that a higher-ability player has a higher probability of winning the prize than a lower-ability player. Put differently, a stronger player has an advantage over a weaker player in a contest. There are very few exceptions to this standard result. I consider a...

Persistent link: https://www.econbiz.de/10012669006

Analysing the determinants of credit risk for General Insurance firms in the UK

Caporale, Guglielmo Maria; Cerrato, Mario; Zhang, Xuan - 2016

This paper estimates a reduced-form model to assess the credit risk of General Insurance (GI) non-life firms in the UK. Compared to earlier studies, it uses a much larger sample including 30 years of data for 515 firms, and also considers a much wider set of possible determinants of credit risk....

Persistent link: https://www.econbiz.de/10011497884

Macroeconomic dynamics and credit risk : a global perspective

Schuermann, Til; Treutler, Björn-Jakob; Weiner, Scott M.; … - 2003

We develop a framework for modeling conditional loss distributions through the introduction of risk factor dynamics. Asset value changes of a credit portfolio are linked to a dynamic global macroeconometric model, allowing macro effects to be isolated from idiosyncratic shocks. Default...

Persistent link: https://www.econbiz.de/10011508097

How to sell a (bankrupt) company

Cornelli, Francesca; Felli, Leonardo - 2000

The restructuring of a bankrupt company often entails the sale of such company. This paper suggests a way to sell the company that maximizes the creditors' proceeds. The key to this proposal is the option left to the creditors to retain a fraction of the shares of the company. Indeed, by...

Persistent link: https://www.econbiz.de/10009781568

Business tax policy under default risk

Comincioli, Nicola; Vergalli, Sergio; Panteghini, Paolo - 2019

In this article we use a stochastic model with one representative firm to study business tax policy under default risk. We will show that, for a given tax rate, the government has an incentive to reduce (increase) financial instability and default costs if its objective function is welfare (tax...

Persistent link: https://www.econbiz.de/10012024508

Country default risk : an empirical assessment

Stein, Jerome L.; Paladino, Giovanna - 2001

We provide benchmarks to evaluate what is an optimal foreign debt and a maximal foreign debt (debt-max), when risk is explicitly considered. When the actual debt exceeds debt-max, then the economy will default when a bad shock occurs. This paper is an application of the stochastic optimal...

Persistent link: https://www.econbiz.de/10011398652

Equilibrium theory of banks' capital structure

Gale, Douglas; Gottardi, Piero - 2017

We study an environment where the capital structure of banks and firms are jointly determined in equilibrium, so as to balance the benefits of the provision of liquidity services by bank deposits with the costs of bankruptcy. The risk in the assets held by firms and banks is determined by the...

Persistent link: https://www.econbiz.de/10011688427

The impact of defaults on technology adoption, and its underappreciation by policymakers

Bergman, Peter; Rogers, Todd - 2017

We conduct an experiment to understand how enrollment defaults affect the take up and impact of an education technology. We show that a standard and simplified opt-in process induce low take up. Automatically enrolling parents increases adoption significantly and improves student achievement....

Persistent link: https://www.econbiz.de/10011747457