Do the right firms survive bankruptcy? *

• 成果类型: Article
• 署名作者: Antill, Samuel
• 署名单位: Harvard University
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2021.07.006
• 发表日期: 2022
• 页码: 523-546
• 关键词: bankruptcy; Recovery rate; structural estimation; Roy model; 363 sales

摘要

In Chapter 11 bankruptcy cases in the United States, firms are either reorganized, acquired, or liquidated. I show that decisions to liquidate often reduce creditor recovery, costing creditors billions of dollars every year. I exploit the within-district random assignment of bankruptcy judges to estimate a structural model of bankruptcy. I estimate that liquidation is frequently chosen when a reorganization would have maximized total creditor recovery. Liquidations involving 363 sales, in which managers sell assets without creditor approval, are especially harmful for creditors. I estimate that courts could dramatically improve cred-itor recovery by assigning liquidations using a statistical model.(c) 2021 Elsevier B.V. All rights reserved.