@techreport{Hainz2004Quality,
abstract = {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 receives a payoff if a firm is liquidated.
Second, it loses the rent from incumbent customers that is 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. There is also a range where improving
institutions may decrease the number of bad firms liquidated.},
author = {Christa Hainz},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {K10; G33; G21; D82; 330; credit markets; institutions; bank competition; information sharing; bankruptcy; relationship banking; Konkurs; Liquidation; Bankgesch\"{a}ft; Firmenkundengesch\"{a}ft; Asymmetrische Information; Institutionelle Infrastruktur},
language = {eng},
number = {1362},
title = {Quality of institutions, credit markets and bankruptcy},
type = {CESifo working papers},
url = {http://hdl.handle.net/10419/18725},
year = {2004}
}
