Essays in Corporate and Consumer Finance
Contributors: Ivashina, Victoria; Gilson, Stuart C.; Scharfstein, David S.; Stein, Jeremy C.; Green, Jerry R.
Published: 2013
Language: eng
Description: The first essay tests whether Chapter 11 restructuring outcomes are affected by time constraints in busy bankruptcy courts. Using the passage of the Bankruptcy Abuse Prevention and Consumer Protection Act in 2005 as an exogenous shock to court caseloads, I estimate the impact of bankruptcy caseload changes on the outcomes of firms in Chapter 11. I find that as bankruptcy judges become busier they tend to allow more firms to reorganize. Firms that reorganize in busy courts spend longer in bankruptcy, while firms that are dismissed from busy courts are more likely to re-file for bankruptcy within three years of their original filing. In addition, busy courts impose costs on local banks, which report higher charge-offs on business lending when caseload increases.
Notes: Keywords: bankruptcy, capital structure, lottery, restructuring, savings.

Thesis Ph.D. Harvard University 2013