Financial reorganization under bankruptcy reduces a firm's debts to a serviceable level through negotiations overseen by courts. Markets have been suggested as an alternative to such negotiations, recognizing that equity holders and junior claimants have call options to buy the firm back from...

Auctions may be an appropriate way to reorganize the liabilities of some overindebted East Asian firms - those that are generally well run, for which there is merit in keeping the existing owners in place, but for which conventional bankruptcy procedures are proving too slow. This Note proposes...

Most bankruptcy procedures try to reorganize a financially-distressed firm's debts to a serviceable level through negotiations overseen by courts. Markets are an alternative to such negotiations. This paper develops a market-based approach that is appropriate if claimants are severely...