Using Hungarian data, this paper provides the first large-scale study measuring the bias in favour of inefficient going concerns induced by court-administered bankruptcy procedures. We find that the large majority of bankrupt firms in our sample are kept as going concerns, although the evidence...

This paper provides the first large-scale study measuring the bias in favour of going concerns induced by court-administered bankruptcy procedures. Although we find that the large majority of bankrupt firms in our sample are kept as going concerns, the evidence suggests that they sharply reduce...