Page info: *Author: Mathiesen, H. *Document version: 2.5. *Copyright 1997-2017, ViamInvest. Legal notice.



 

Table: International corporate governance - Tentative characterizations of legal and empirical state of large firm bankruptcy systems in various countries as of 1980-1995:

 

Introduction: Some of the characterizations can be found in Shleifer and Vishny [1996, pages 49-55]. Precautionary statement: The first version of this table was primarily made out of memory and consequently it lacks adequate references and may contain errors about the actual legal and empirical state of the different institutions. As time passes more references will be added.

 

Tentative characterizations of legal and empirical state of large firm bankruptcy systems in developing countries as of 1980-1995

 

A) Laws that protect creditors.

Legal state: Not accounted.

Empirical state: Bankruptcies seems to be more common than in other kinds of governance systems, probably caused by the higher degree of economic instability in developing countries rather that flaws in the bankruptcy system.

Tentative characterizations of legal and empirical state of large firm bankruptcy systems in Germany as of 1980-1995

 

A) Laws that protect creditors.

Legal state: Tougher regulation. No chapter 11 protects the management and the owners from the creditors.

Empirical state: Large firms are seldom bankrupted. However, if thing goes very wrong the large institutional investors often take temporary control in order to restructure the firm and possibly replace the management.

Tentative characterizations of legal and empirical state of large firm bankruptcy systems in Japan as of 1980-1995

 

A) Laws that protect creditors.

Legal state: Softer regulation: E.g. managers and owners are protected against creditors by ‘chapter 11’ like regulation.

Empirical state: Large firms are observed to go into ‘chapter 11’ like protection but it is very seldom that they bankrupt entirely.

Tentative characterizations of legal and empirical state of large firm bankruptcy systems in Anglo-American countries as of 1980-1995

 

A) Laws that protect creditors.

Legal state: Softer regulation: E.g. managers and owners are protected against creditors by chapter 11 regulation.

Empirical state: Large firms are observed to go into chapter 11 protection but it is very seldom that they bankrupt entirely.

Tentative characterizations of legal and empirical state of large firm bankruptcy systems in Denmark as of 1980-1995

 

A) Laws that protect creditors.

Legal state: Tougher regulation. No chapter 11 protects the management and the owners from the creditors.

Empirical state: Large firms are seldom bankrupted. However, if thing goes very wrong the large institutional investors often take temporary control in order to restructure the firm and possibly replace the management.

- Copyright 1997-2017, ViamInvest. Reproduced with permission of the copyright owner. Further reproduction prohibited without permission. Legal notice.