IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/7921.html
   My bibliography  Save this paper

Different Approaches to Bankruptcy

Author

Listed:
  • Oliver Hart

Abstract

In the last fifteen years or so, lawyers working in law and economics and economists with an interest in legal matters have turned their attention to the topic of bankruptcy. A large amount of work has resulted, both theoretical and empirical, some of which has been concerned with the functioning of existing bankruptcy procedures and some with bankruptcy reform. Although researchers in this area have expressed different views, I believe that one can identify a consensus on certain issues, e.g., the goals of bankruptcy and some of the characteristics of an efficient bankruptcy procedure. This paper summarizes this consensus. One point I will stress is that it is unlikely that one size fits all.' That is, although some bankruptcy procedures can probably be rejected as being manifestly bad, there is a class of procedures that satisfy the main criteria of efficiency. Which procedure a country chooses or should choose may then depend on other factors, e.g., the country's institutional structure and legal tradition. One can also imagine a country choosing a menu of procedures and allowing firms to select among them.

Suggested Citation

  • Oliver Hart, 2000. "Different Approaches to Bankruptcy," NBER Working Papers 7921, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:7921
    Note: CF
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w7921.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Philippe Aghion & Oliver D. Hart & John Moore, 1994. "The Economics of Bankruptcy Reform," NBER Chapters, in: The Transition in Eastern Europe, Volume 2, Restructuring, pages 215-244, National Bureau of Economic Research, Inc.
    2. Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer & Robert W. Vishny, 1998. "Law and Finance," Journal of Political Economy, University of Chicago Press, vol. 106(6), pages 1113-1155, December.
    3. repec:bla:jfinan:v:53:y:1998:i:3:p:939-978 is not listed on IDEAS
    4. Hart, Oliver & La Porta Drago, Rafael & Lopez-de-Silanes, Florencio & Moore, John, 1997. "A new bankruptcy procedure that uses multiple auctions," European Economic Review, Elsevier, vol. 41(3-5), pages 461-473, April.
    5. Rowat, M. & Astigarraga, J., 1999. "Latin American Insolvency Systems. A Comparative Assessment," Papers 433, World Bank - Technical Papers.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Aloisio Araujo, 2002. "As Leis de Falência: uma Abordagem Econômica," Working Papers Series 57, Central Bank of Brazil, Research Department.
    2. Felipe Balmaceda & Ronald Fischer, 2006. "Performance of an economy with credit constraints, bankruptcy and labor inflexibility," Documentos de Trabajo 222, Centro de Economía Aplicada, Universidad de Chile.
    3. Pierre-Cyrille Hautcoeur & Nadine Levratto, 2006. "Does the law alone explain the rise in bankruptcies in XIXth century France?," Working Papers halshs-00589125, HAL.
    4. Urs W. Birchler & Dominik Egli, 2003. "Ein neues Bankinsolvenzrecht für die Schweiz," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 139(II), pages 125-154, June.
    5. Thapa, Chandra & Rao, Sandeep & Farag, Hisham & Koirala, Santosh, 2020. "Access to internal capital, creditor rights and corporate borrowing: Does group affiliation matter?," Journal of Corporate Finance, Elsevier, vol. 62(C).
    6. Pierre-Cyrille Hautcoeur & Nadine Levratto, 2007. "Legal versus economic explanations of the rise in bankruptcies in 19th century France," PSE Working Papers halshs-00587693, HAL.
    7. Nobel Prize Committee, 2016. "Oliver Hart and Bengt Holmström: Contract Theory," Nobel Prize in Economics documents 2016-1, Nobel Prize Committee.
    8. Oliver Hart, 2006. "Different approaches to bankruptcy," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 4(1), pages 3-8, 04.
    9. Eduard Marinov, 2016. "The 2016 Nobel Prize in Economics," Economic Thought journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 6, pages 97-149.
    10. Dimas Mateus Fazio & Thiago Christiano Silva & Janis Skrastins, 2020. "Economic Resilience: spillovers, courts, and vertical integration," Working Papers Series 531, Central Bank of Brazil, Research Department.
    11. Blazy, Régis & Chopard, Bertrand & Nigam, Nirjhar, 2013. "Building legal indexes to explain recovery rates: An analysis of the French and English bankruptcy codes," Journal of Banking & Finance, Elsevier, vol. 37(6), pages 1936-1959.
    12. Chopard, Bertrand & Langlais, Eric, 2009. "Défaut de paiement stratégique et loi sur les défaillances d'entreprises [Strategic default and bankruptcy law]," MPRA Paper 14366, University Library of Munich, Germany.
    13. Régis Blazy & Nirjhar Nigam, 2019. "Corporate insolvency procedures in England: the uneasy case for liquidations," European Journal of Law and Economics, Springer, vol. 47(1), pages 89-123, February.
    14. 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.
    15. Hart, Oliver & La Porta Drago, Rafael & Lopez-de-Silanes, Florencio & Moore, John, 1997. "A new bankruptcy procedure that uses multiple auctions," European Economic Review, Elsevier, vol. 41(3-5), pages 461-473, April.
    16. Bernardus Ferdinandus Nazar Van Doornik & Lucio Rodrigues Capelletto, 2015. "Collateral after the Brazilian Creditor Rights Reform," Working Papers Series 404, Central Bank of Brazil, Research Department.
    17. Philippe Frouté, 2007. "Theoretical foundation for a debtor friendly bankruptcy law in favour of creditors," European Journal of Law and Economics, Springer, vol. 24(3), pages 201-214, December.
    18. Ariane Lambert-Mogiliansky & Konstantin Sonin & Ekaterina Zhuravskaya, 2006. "Are Russian commercial courts biased?Evidence from a natural bankruptcy experiment," Working Papers halshs-00590402, HAL.
    19. Nam, Ilchong & Oh, Soogeun, 2000. "Bankruptcy of Large Firms and Exit Mechanisms in Korea," KDI Research Monographs, Korea Development Institute (KDI), volume 127, number 200001.
    20. Régis Blazy & Bertrand Chopard & Agnès Fimayer & Jean-Daniel Guigou, 2007. "Financial versus Social Efficiency of Corporate Bankruptcy Law: the French Dilemma?," LSF Research Working Paper Series 07-02, Luxembourg School of Finance, University of Luxembourg.

    More about this item

    JEL classification:

    • G3 - Financial Economics - - Corporate Finance and Governance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:7921. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.