Arbeitspapier
Quality of Institutions, Credit Markets and Bankruptcy
The number of firm bankruptcies is surprisingly low in economies with poor institutions. We study a model of bank-firm relationship and show that the bank's decision to liquidate bad firms has two opposing effects. First, the bank gets a payoff if a firm is liquidated. Second, it loses the rent from incumbent customers due to its informational advantage. We show that institutions must improve significantly in order to yield a stable equilibrium in which the optimal number of firms is liquidated. However, in a particular range, improving institutions may even decrease the number of bad firms liquidated.
- Sprache
-
Englisch
- Erschienen in
-
Series: Munich Discussion Paper ; No. 2004-18
- Klassifikation
-
Wirtschaft
Banks; Depository Institutions; Micro Finance Institutions; Mortgages
Bankruptcy; Liquidation
Basic Areas of Law: General (Constitutional Law)
Asymmetric and Private Information; Mechanism Design
- Thema
-
Credit markets
institutions
bank competition
information sharing
bankruptcy
relationship banking
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Hainz, Christa
- Ereignis
-
Veröffentlichung
- (wer)
-
Ludwig-Maximilians-Universität München, Volkswirtschaftliche Fakultät
- (wo)
-
München
- (wann)
-
2004
- DOI
-
doi:10.5282/ubm/epub.388
- Handle
- URN
-
urn:nbn:de:bvb:19-epub-388-5
- Letzte Aktualisierung
-
10.03.2025, 11:44 MEZ
Datenpartner
Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Hainz, Christa
- Ludwig-Maximilians-Universität München, Volkswirtschaftliche Fakultät
Entstanden
- 2004
Ähnliche Objekte (12)
Quality of institutions, credit markets and bankruptcy
Quality of Institutions, Credit Markets and Bankruptcy
On the role of bankruptcy laws in credit markets
Tighter Credit and Consumer Bankruptcy Insurance
Personal bankruptcy and credit market competition
Institutional quality and credit growth: "Sand" or "grease" effect? Evidence from microfinance institutions
Signalling in credit markets
The impact of bankruptcy reform on insolvency choice and consumer credit
Securitization and credit quality
Early Warning System for Bankruptcy: Bankruptcy Prediction
Bankruptcy extraordinary
Evolution in markets and institutions
Quality of institutions, credit markets and bankruptcy
Quality of Institutions, Credit Markets and Bankruptcy
On the role of bankruptcy laws in credit markets
Tighter Credit and Consumer Bankruptcy Insurance
Personal bankruptcy and credit market competition
Institutional quality and credit growth: "Sand" or "grease" effect? Evidence from microfinance institutions
Signalling in credit markets
The impact of bankruptcy reform on insolvency choice and consumer credit
Securitization and credit quality
Early Warning System for Bankruptcy: Bankruptcy Prediction
Bankruptcy extraordinary
Evolution in markets and institutions
Quality of institutions, credit markets and bankruptcy
Quality of Institutions, Credit Markets and Bankruptcy
On the role of bankruptcy laws in credit markets
Tighter Credit and Consumer Bankruptcy Insurance
Personal bankruptcy and credit market competition
Institutional quality and credit growth: "Sand" or "grease" effect? Evidence from microfinance institutions
Signalling in credit markets
The impact of bankruptcy reform on insolvency choice and consumer credit
Securitization and credit quality
Early Warning System for Bankruptcy: Bankruptcy Prediction
Bankruptcy extraordinary