Both personal bankruptcy and redistributive taxes can insure households' consumption risk and both vary considerably … across US states. We derive sufficient conditions under which more redistributive taxation makes bankruptcy exemptions less … bankruptcy exemptions are negatively correlated; (ii) both policies are associated with more equal consumption growth whereas the …

"This paper examines how filing for bankruptcy under Chapter 13 helps financially distressed debtors save their homes … reduce the total amount owed. We develop a model of debtors' decisions to default on their mortgages and file for bankruptcy … and we evaluate it using a new dataset of debtors who filed for bankruptcy under Chapter 13 in 2006. We also examine the …