Recovery Rate from Insolvency Proceedings in Developed Countries
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From a macroeconomic perspective, the purpose of insolvency proceedings is to ensure that a company’s assets trapped in insufficient economic functioning are transferred expediently and with the lowest possible costs to other subjects. These subjects will arrange their renewed involvement in corporate connections and entrepreneurial activity. From an economic perspective, these proceedings should ensure that creditor rights are quickly and effectively fulfilled and should enable the enforceability of debtor receivables in default or in bankruptcy.
We study potential relationships among costs of insolvency proceedings, yields from such proceedings for creditors and the performance of a given economy using data from Doing Business (World Bank – IFC 2013; Doing Business 2013.). Twenty-nine of the 34 Organization for Economic Co-operation and Development (OECD) member countries were selected as the group of researched countries (not all necessary data were available for five countries)....
This paper is one of the outputs of research projects TD020190 and IGA VŠE F3/2/2014.