Some Effects of the Bankruptcy Reform Act of 1978

Boyes, William J.; Faith, Roger L.

doi:10.1086/467112

Cited by 47 publications

(24 citation statements)

References 4 publications

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“…Shepard [1984], Peterson and Aoki [1984], and Boyes and Faith [1986] find evidence that the BRA78 increased the number of bankruptcy filings relative to what would be predicted based on time series patterns prior to 1978, but Domowitz and Eovaldi [1993] find that the BRA78 had no effect. Boyes and Faith also suggest that risky borrowers may have been excluded from the credit market by BRA78.…”

Section: Background Literaturementioning

confidence: 89%

Personal Bankruptcy and Credit Supply and Demand

Gropp¹,

Scholz²,

White³

1997

The Quarterly Journal of Economics

396

289

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This paper examines how personal bankruptcy and bankruptcy exemptions affect the supply and demand for credit. While generous state-level bankruptcy exemptions are probably viewed by most policymakers as benefiting less-well-off borrowers, our results using data from the 1983 Survey of Consumer Finances suggest they increase the amount of credit held by high-asset households and reduce the availability and amount of credit to low-asset households, conditioning on observable characteristics. We also find evidence that interest rates on automobile loans for lowasset households are higher in high exemption states. Thus, bankruptcy exemptions redistribute credit toward borrowers with high assets.

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Section: Background Literaturementioning

confidence: 89%

Personal Bankruptcy and Credit Supply and Demand

Gropp¹,

Scholz²,

White³

1997

The Quarterly Journal of Economics

396

289

View full text Add to dashboard Cite

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“…Possibly the most commonly suggested explanation is that the cost of filing for bankruptcy has declined (e.g., Gross and Souleles, 2002). This can be a result of amendments to the U.S. bankruptcy code, which had made bankruptcy more attractive to borrowers (as suggested by Shepard (1984) and Boyes and Faith (1986)) or of the increased willingness of lenders to advance new loans to borrowers with a record of bankruptcy 11 (Han et al (2013) document the availability of new credit to recent filers). The more common version of this explanation is that the "stigma" attached to bankrupts has weakened (e.g., Buckley and Brinig, 1998;Fay et al, 2002), or as the then Chairman of the Federal Reserve Board Alan Greenspan had put it in his testimony before Congress in 1999, "personal bankruptcies are soaring because Americans have lost their sense of shame."…”

Section: The Rise In Personal Bankruptcies and Consumer Creditmentioning

confidence: 99%

Recent Developments in Consumer Credit and Default Literature

Livshits

2015

Journal of Economic Surveys

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This survey discusses recent contributions to the quantitative literature on unsecured consumer debt and default, and some ongoing challenges for the literature. Key topics include the sources of the rise in personal bankruptcies, the importance of asymmetric information and the effects of developments in information technologies on consumer credit markets, delinquency and informal bankruptcy, debt collection and restructuring of distressed debt, the cyclical behavior of consumer debt and default, and the insurance role of household debt. Implications for welfare analysis and policy design are discussed. Several theoretical contributions and approaches to modeling the consumer credit markets are also highlighted.

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“…Various social, economic, and demographic factors have been hypothesized to contribute to the growing number of personal bankruptcies. These factors include rising debt levels and easier access to credit (Shephard, 1984a;Domowitz and Sartain, 1999), higher divorce rates (Shephard, 1984a;Heck, 1981), changes to bankruptcy laws (Shephard, 1984b;Boyes and Faith, 1986), changes in economic conditions (Eckstein and Sinai, 1986;Domowitz and Eovaldi, 1993), and a decreased social stigma attached to bankruptcy (Sullivan et al, 1988(Sullivan et al, , 1989). …”

Section: Personal Bankruptcy and Casino Gamblingmentioning

confidence: 99%

Do casinos export bankruptcy?

Garrett

Nichols

2008

The Journal of Socio-Economics

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This paper measures the extent to which destination resort casinos export bankruptcy back to visitors' home states. Previous literature has alluded to this possibility, but to date studies have only examined the influence of local casinos on local bankruptcy. Using various survey data, we calculate the number of visits from each state to casino resort destinations in Nevada, New Jersey, and Mississippi. We find strong evidence that states having more residents who visit out-of-state casino resorts have higher bankruptcy filings. This effect is dominant in the south, suggesting that casinos located in wealthier regions are less likely to export bankruptcy. AbstractThis paper measures the extent to which destination resort casinos export bankruptcy back to visitors' home states. Previous literature has alluded to this possibility, but to date studies have only examined the influence of local casinos on local bankruptcy. Using various survey data, we calculate the number of visits from each state to casino resort destinations in Nevada, New Jersey, and Mississippi. We find strong evidence that states having more residents who visit out-of-state casino resorts have higher bankruptcy filings. This effect is dominant in the south, suggesting that casinos located in wealthier regions are less likely to export bankruptcy.

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Some Effects of the Bankruptcy Reform Act of 1978

Cited by 47 publications

References 4 publications

Personal Bankruptcy and Credit Supply and Demand

Personal Bankruptcy and Credit Supply and Demand

Recent Developments in Consumer Credit and Default Literature

Do casinos export bankruptcy?

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