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Debt Enforcement around the World

Author

Listed:
  • Simeon Djankov
  • Oliver Hart
  • Caralee McLiesh
  • Andrei Shleifer

Abstract

Insolvency practitioners from 88 countries describe how debt enforcement will proceed against an identical hotel about to default on its debt. We use the data on time, cost, and the likely disposition of the assets (preservation as a going concern vs. piecemeal sale) to construct a measure of the efficiency of debt enforcement in each country. This measure is strongly correlated with per capita income and legal origin and predicts debt market development. Several characteristics of debt enforcement procedures, such as the structure of appeals and availability of floating charge finance, influence efficiency. (c) 2008 by The University of Chicago. All rights reserved.

Suggested Citation

  • Simeon Djankov & Oliver Hart & Caralee McLiesh & Andrei Shleifer, 2008. "Debt Enforcement around the World," Journal of Political Economy, University of Chicago Press, vol. 116(6), pages 1105-1149, December.
  • Handle: RePEc:ucp:jpolec:v:116:y:2008:i:6:p:1105-1149
    DOI: 10.1086/595015
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    More about this item

    JEL classification:

    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation
    • K2 - Law and Economics - - Regulation and Business Law

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