NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
loading...

Asset Allocation in Bankruptcy

Shai Bernstein, Emanuele Colonnelli, Ben Iverson

NBER Working Paper No. 23305
Issued in March 2017
NBER Program(s):Corporate Finance

This paper investigates the consequences of liquidation and reorganization on the allocation and subsequent utilization of assets in bankruptcy. Using the random assignment of judges to bankruptcy cases as a natural experiment that forces some firms into liquidation, we find that the long-run utilization of assets of liquidated firms is lower relative to assets of reorganized firms. These effects are concentrated in thin markets with few potential users, and in areas with low access to finance. The results highlight the importance of local search frictions and financial frictions in affecting the allocation of assets in bankruptcy.

download in pdf format
   (1529 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w23305

Users who downloaded this paper also downloaded* these:
Bernstein, Colonnelli, Giroud, and Iverson w23162 Bankruptcy Spillovers
Bloom, Brynjolfsson, Foster, Jarmin, Patnaik, Saporta-Eksten, and Van Reenen w23300 What Drives Differences in Management?
Egan, Lewellen, and Sunderam w23291 The Cross Section of Bank Value
Rampini and Viswanathan w23302 Financial Intermediary Capital
Du, Harrison, and Jefferson w16767 FDI Spillovers and Industrial Policy: The Role of Tariffs and Tax Holidays
 
Publications
Activities
Meetings
NBER Videos
Themes
Data
People
About

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us