Restart-Performance and the Returns of Previous Self-Employment

Going bankrupt does not necessarily mean the end of an entrepreneurial career. Recent reforms of the insolvency law in several European countries towards a more debtorfriendly system similar to Chapter 11 of the U.S. bankruptcy code make it easier for bankrupt entrepreneurs to start a new business. According to the new German insolvency law, private persons are freed of the remainder of their dept after a period of six years ("Wohlverhaltensperiode") during which they are obliged to hand over a large part of their earnings to the creditors...