Personal bankruptcy law, debt portfolios, and entrepreneurship

• 成果类型: Article
• 署名作者: Mankart, Jochen; Rodano, Giacomo
• 署名单位: Deutsche Bundesbank; European Central Bank; Bank of Italy
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2015.09.001
• 发表日期: 2015
• 页码: 157-172
• 关键词: Debt portfolio; Personal bankruptcy; entrepreneurship; occupational choice

摘要

Bankruptcy provides entrepreneurs with insurance against the financial consequences of failure at the cost of worsened credit conditions. Using a quantitative general equilibrium model of entrepreneurship, we show that the presence of secured credit in addition to unsecured credit substantially alters this trade-off. If secured credit is not available the optimal bankruptcy law is harsh since the negative effect dominates. If secured credit is available the optimal law is lenient since entrepreneurs rationed out of the unsecured credit market can still obtain secured credit, lowering the costs of worse credit conditions. We find significant welfare gains from reforming the law. (C) 2015 Elsevier B.V. All rights reserved.