From courtrooms to corporations: The effect of bankruptcy court establishment on firm acquisitions

Obaid Ur Rehman, Zihan Zhou, Kai Wu and Wen Li

Finance Research Letters, 2024, vol. 61, issue C

Abstract: We examine the impact of bankruptcy court establishment (BCE) on corporate acquisition activities using hand-collected data of city-level BCE in China from 2008 to 2020. The results show that BCE promotes corporate acquisition activities largely due to mitigated information asymmetry and decreased deal inefficiency. Our results highlight the important role of judiciary reform in corporate acquisition decisions in emerging markets.

Keywords: Bankruptcy court; Judiciary reform; Firm acquisition (search for similar items in EconPapers)
JEL-codes: G33 G34 K4 (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:61:y:2024:i:c:s1544612324000679

DOI: 10.1016/j.frl.2024.105037

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