Klapper, Leora2012-08-132012-08-132011-09https://hdl.handle.net/10986/11056The 2008 financial crisis and consequent rise in corporate insolvencies highlight the clear need for efficient bankruptcy systems to liquidate unviable firms and reorganize viable ones and to do so in a way that maximizes the proceeds for creditors, shareholders, employees, and other stakeholders. This note summarizes the empirical literature on the effect of insolvency reforms on economic and financial activity. Overall, research suggests that effective reforms increase timely repayments, reduce the cost of credit, and lower the rate of liquidation among distressed firms.CC BY 3.0 IGOACCOUNTANCYACCOUNTS PAYABLEALTERNATIVE TO LIQUIDATIONASSET SALESBANK LOANSBANKRUPTCYBANKRUPTCY ABUSEBANKRUPTCY CODEBANKRUPTCY COSTSBANKRUPTCY FILINGSBANKRUPTCY INSTITUTEBANKRUPTCY LAWBANKRUPTCY LAW REFORMBANKRUPTCY LAWSBANKRUPTCY PROCEDURESBANKRUPTCY PROCEEDINGSBANKRUPTCY RATESBANKRUPTCY REFORMBANKRUPTCY REGIMESBANKRUPTCY SYSTEMBANKRUPTCY SYSTEMSBARRIERBORROWERBORROWER BEHAVIORBORROWINGBUSINESS BANKRUPTCYCOLLATERALCOMMERCIAL BANKSCONSUMER PROTECTIONCORPORATE BANKRUPTCIESCOST OF BANKRUPTCYCOST OF DEBTCREDIBILITYCREDIT CARDCREDIT CARD DEBTCREDIT CARDSCREDIT DECISIONSCREDITORCREDITOR PROTECTIONCREDITORSDEBTDEBT RECOVERYDEBT RESTRUCTURINGDEBTORDEBTORSECONOMICSEFFECT OF INSOLVENCYEFFECTIVE INSOLVENCYENFORCEMENT MECHANISMSESTATEFAILURE RATEFAILURE RATESFINANCIAL CRISESFINANCIAL CRISISFINANCIAL DISTRESSFORECLOSUREIMPACT OF DEBTINCOMEINCOME GROUPINDIVIDUAL BANKRUPTCYINSOLVENCY FRAMEWORKSINSOLVENCY LAWSINSOLVENCY REFORMINSOLVENCY REFORMSINSOLVENCY REGIMESINSOLVENTINSOLVENT FIRMSINSURANCEINTEREST EXPENSEINTEREST RATESINTERNATIONAL DEVELOPMENTINVESTMENT CLIMATEJUDICIAL ENFORCEMENTLEGAL FRAMEWORKLEGAL REFORMLENDERSLEVEL OF CREDITLIMITED LIABILITYLIQUIDATIONLIQUIDATION REORGANIZATIONLIQUIDATIONSLOANLOAN PORTFOLIOSLOAN REPAYMENTLONG-TERM DEBTMINIMUM CAPITAL REQUIREMENTSMORTGAGENONPERFORMING LOANSPERSONAL BANKRUPTCYPERSONAL BANKRUPTCY LAWSPERSONAL LIABILITYPOLITICAL ECONOMYPRIVATE SECTOR DEVELOPMENTPUBLIC POLICYQUALITY OF BANKSREORGANIZATIONREORGANIZATION PLANSREORGANIZATION PROCESSREORGANIZATIONSREPAYMENTREPAYMENT RATESREPAYMENTSSAVINGSSUPPLY OF CREDITVIABLE BUSINESSESWORLD DEVELOPMENT INDICATORSWorld Bank10.1596/11056