We explore the ways French judges respond to the possibility of discharging personal debts in exchange for liquidation of debtors’ assets. We present empirical results on the determinants of judicial selection between debtors whose debts are wiped out and those who have to reimburse them. We...

The paper investigates the French dilemma associated with court administered resolution of corporate financial distress. In such a legal system, the courts seek a double objective: maintaining job positions through continuation, and determining the best outcome for the claimants. We discuss this...

This paper provides new empirical evidence on the reasons why French banks use collateral. We test the relevance of the reduction of loan loss in the event of default and the resolution of adverse selection problems as satisfactory reasons for this use. We use a dataset of 564 bank loans on...

This empirical paper investigates the determinants of the arbitration taking place after a corporate default. Two ways of resolving financial distress are conceivable: either the creditors privately renegotiate with the debtor, or a formal bankruptcy procedure is triggered off. This arbitration...

Following the common use of collateral in SME lending, this article aims attesting empirically the three major theoretical reasons for using collateral: reduction of loan loss in the event of default, adverse selection and moral hazard. We use a unique dataset of 735 bank loans granted to French...

The paper analyzes the characteristics of bankruptcy procedures that may impact on creditors’ recoveries. We propose 132 legal indexes accounting for the main functions of bankruptcy codes: namely, the accessibility of the procedures, their ability to disclose information, the protection of...