This paper aims at testing empirically the three major theoretical reasons why banks resort to collateral: reduction of loan loss in the event of default, adverse selection, and moral hazard. This investigation is performed by testing whether the reasons vary according to the type of collateral....

The aim of this paper is to provide new evidence on the value-creation process taking place in bankruptcy procedures that belong to different legal systems (French civil law, German civil law, and common law): to do so, we assess to which extent the debtor’s value can be preserved under...

This paper provides evidence on the value creation of bankruptcy procedures that belong to different legal systems (French civil law, German civil law, and British common law). Using a sample of 900 hand-collected corporate bankruptcy files, we find that France and Germany show quite similar...

This paper provides evidence on the value creation of bankruptcy procedures that belong to different legal systems (French civil law, German civil law, and British common law). Using a sample of 900 hand-collected corporate bankruptcy files, we find that France and Germany show quite similar...

This research investigates how legal sanctions prevailing under bankruptcy impact on debt contracting and on investing decision, when companies may engage faulty management. Unlike most papers considering a passive behavior of the bank in case of default of the borrower, the creditor and the...

We study the French dilemma associated with court administered resolution of corporate financial distress of firms, in which bankruptcy courts have to combine both social efficiency (maintaining employment) and ex post financial efficiency (determining the best issue for financial distress,...