For nearly two years, the two of us have had a running discussion of the costs and benefits of automatic stays in bankruptcy for qualified financial contracts (QFCs) such as derivatives and repurchase agreements, particularly those held by systemically important major dealer banks. Under current...

Government bailouts undermine the core principles of capitalism. They are also expensive, unjust, unpopular, and usually represent dramatic deviations from the rule of law. However, they are also, in some cases, necessary. The “problem of bailouts,” then, is that they are almost always...

This paper empirically examines business starts, deaths, venture capital and patents in relation to U.S. public policy. The most consistent evidence in the data shows that lower levels of labor frictions and higher levels of SBIR awards are associated with more business starts and higher levels...

This paper empirically examines business starts, deaths, venture capital and patents in relation to U.S. public policy. The most consistent evidence in the data shows that lower levels of labor frictions and higher levels of SBIR awards are associated with more business starts and higher levels...

The lenders that fund Chapter 11 reorganizations exert significant influence over the bankruptcy process through the contract associated with the debtor-in-possession (“DIP”) loan. In this Article, we study a large sample of DIP loan contracts and document a trend: over the past three...

Claims trading has become a significant and controversial feature of American bankruptcy practice over the past thirty years. This Report chronicles the rise of claims trading in the second decade of the Bankruptcy Reform Act of 1978 and analyzes the various policy concerns it raises. Most...

A crucial decision for large corporations is how profits created by corporate activity should be distributed among different corporate stakeholders. This article posits that public policy should recognize employees as key contributors to corporate value-creation. One approach is to require the...

We find that an increase in a firm's incentives to use trade secrets to protect its intellectual property results in a more actively managed capital structure. Exploiting U.S. states' adoption of the Uniform Trade Secrets Act as a positive “shock” in the protection afforded to trade secrets,...

Following in the steps of the US and UK, China introduced partnerships with limited liability in 2006, the same year that a market-oriented bankruptcy statute was enacted. Although the bankruptcy statute enshrines basic elements of modern bankruptcy law, it fails to stipulate specific rules for...

This is a chapter for the forthcoming book in West Publishing Company's Inside the Minds Series focusing on Financial Services Enforcement and Compliance (published by Aspatore Books). This chapter provides an overview of nature and current state of the markets for the equity side and debt...