This paper provides evidence on the value creation of bankruptcy procedures that belong to different legal systems (French civil law, German civil law, and British common law). Using a sample of 900 hand-collected corporate bankruptcy files, we find that France and Germany show quite similar...

This research investigates how legal sanctions prevailing under bankruptcy impact on debt contracting and on investing decision, when companies may engage faulty management. Unlike most papers considering a passive behavior of the bank in case of default of the borrower, the creditor and the...

In spite of the massive use of collateral, there exist only few studies on the reasons of the use of collateral. This paper aims at testing empirically the three major theoretical reasons for using collateral: reduction of loan loss in the event of default, adverse selection, and moral hazard....

This paper provides evidence on the value creation of bankruptcy procedures that belong to different legal systems (French civil law, German civil law, and British common law). Using a sample of 900 hand-collected corporate bankruptcy files, we find that France and Germany show quite similar...

This research investigates how legal sanctions prevailing under bankruptcy impact on debt contracting and on investing decision, when companies may engage faulty management. Unlike most papers considering a passive behavior of the bank in case of default of the borrower, the creditor and the...

This research investigates how the legal sanctions prevailing under bankruptcy code impact on the design of debt contacts. Unlike most papers considering a passive behavior of the bank in case of default of the borrower, we assume the bank actively trades off between private renegotiation and...