We show how the efficiency of reorganization is affected by the distribution of control rights under the UK insolvency code. Control rights raise particular problems when creditors have different incentives to keep the firm as a going concern. Such differences may arise from the possession of...

The bankruptcy codes of the United States, the United Kingdom and Germany differ concerning who is permitted to control the debtor in bankruptcy and as to the ability of the debtor to arrange new financing while in bankruptcy. This study compares the efficiency of these three bankruptcy codes...

This paper describes three insolvency codes that differ importantly in their allocation of control rights as between debtors and creditors and in the discretion granted to the party in control. The paper proposes six criteria for judging the efficiency of a bankruptcy code, and discusses the...