We examine bankruptcy within business groups. Groups have incentives to support financially distressed subsidiaries as …, bankruptcy courts often “pierce the corporate veil” and hold groups liable for their distressed subsidiaries' obligations as if …-group insolvencies. We find that large and diversified groups are more effective at insulating their subsidiaries from credit-risk shocks …

straightforward evaluation of the posterior distribution. The methods are used to analyze the effects of monetary policy in Sweden. …