The Determinants of Bankruptcies in the U.K.: 1971-1988

John Hudson and Keith Cuthbertson

The Manchester School of Economic & Social Studies, 1993, vol. 61, issue 1, 65-81

Abstract: This paper analyzes the determinants of bankruptcies in the United Kingdom. The results suggest that important determina nts of bankruptcies are unemployment, increases in interest rates, and b ank and mortgage debt outstanding. The number of self-employed is used t o proxy the number of small unincorporated businesses, while average real incomes of the self-employed proxy their profitability. In the short-term, new credit is found to reduce bankruptcies, although in the long-term it is found to increase bankruptcies. Administrative chang es to the bankruptcy level and deposits are found to be important while the 1986 Insolvency Act may have reduced bankruptcies. Copyright 1993 by Blackwell Publishers Ltd and The Victoria University of Manchester

Date: 1993
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Persistent link: https://EconPapers.repec.org/RePEc:bla:manch2:v:61:y:1993:i:1:p:65-81

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