How Does Personal Bankruptcy Law Affect Startups?

• 成果类型: Article
• 署名作者: Cerqueiro, Geraldo; Fabiana Penas, Maria
• 署名单位: Universidade Catolica Portuguesa; Universidad Torcuato Di Tella
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhw081
• 发表日期: 2017
• 页码: 2523
• 关键词: liquidity constraints; industry structure; credit; finance; barrier

摘要

We exploit state-level changes in the amount of personal wealth individuals can protect under Chapter 7 to analyze the effect of debtor protection on the financing structure and performance of a representative panel of U.S. startups. The effect of increasing debtor protection depends on the entrepreneur's level of wealth. Firms owned by mid-wealth entrepreneurs whose assets become fully protected suffer a reduction in credit availability, employment, operating efficiency, and survival rates. We find no such negative effects for low-wealth and high-wealth owners. Our results are consistent with theories that predict that asset protection in bankruptcy leads to a redistribution of credit.