The fact that 20 percent of personal bankruptcyfilings list business debts suggests that personal bankruptcy procedures areimportant for entrepreneurs. Whether individuals are more likely to becomeentrepreneurs if they live in states with higher bankruptcy exemptions warrantsinvestigation. A...

The U.S. personal bankruptcy system functions as a bankruptcy system for small businesses as well as consumers, because debts of non-corporate firms are personal liabilities of the firms' owners. If the firm fails, the owner has an incentive to file for bankruptcy, since both business debts and...