Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/180667
Authors: 
Dulleck, Uwe
Howell, Nicola J.
Koessler, Ann-Kathrin
Mason, Rosalind F.
Year of Publication: 
2018
Abstract: 
Many Anglo-American jurisdictions aim to provide debtors with a ‘fresh start’ after a personal bankruptcy. However, we query the extent to which debtors can achieve a fresh start if records of individual bankruptcies are publicly available, with no restrictions on their use. To inform the legal policy question of whether bankruptcy records should be publicly available, we study the effect of the availability of bankruptcy records, compared to their non-existence, in an economic experiment. The experiment allows us to identify empirically the effect that the exposure of bankruptcy history has on the behaviour of investors and debtors. Our exploratory research shows that the availability of bankruptcy records increases investment. Availability also increases repayment behaviour by debtors, but only if the debtor has no history of bankruptcy (non-return of payments). If, however, a debtor failed to return payments in the past, and this information is available, debtors show lower instances of return behaviour.
Subjects: 
bankruptcy
investments
National Personal Insolvency Index
uncertainty
economic experiment
insolvency
public records
JEL: 
K35
C90
D47
K20
Document Type: 
Working Paper

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