Has Anything Changed in the Past Century? Revisiting Graue's "The Social Cost of Bad Debt"

Dan Friesner, Donald Hackney, Matthew McPherson and Dan Axelsen

Journal of Economic Issues, 2011, vol. 45, issue 4, 755-784

Abstract: In a seminal paper, Erwin Graue (1939) provides an institutional analysis of the causes and consequences of personal bankruptcy protection in the United States during the period 1900-1937 when bankruptcy procedures were guided by the Federal Bankruptcy Act of 1898 (the Law was revised in 1938). This paper revisits the Graue study in the context of the current recession using a simple institutional economic framework. Consistent with Graue, we begin shortly after the implementation of the Bankruptcy Abuse Protection and Consumer Protection Act of 2005 (BAPCPA) and follow its evolution to the present time. Our analysis suggests that, since passage of BAPCPA, both total filings and Chapter 7 filings decreased significantly, however temporarily. Moreover, Chapter 7 filings as a percentage of Chapter 13 filings also temporarily decreased. These results are not only consistent with Graue's analysis, but also demonstrate that the institutional characteristics of bankruptcy law have a profound impact on the decision to file for bankruptcy and the chapter under which a petitioner files.

Date: 2011
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.2753/JEI0021-3624450401 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mes:jeciss:v:45:y:2011:i:4:p:755-784

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/MJEI20

DOI: 10.2753/JEI0021-3624450401

Access Statistics for this article

More articles in Journal of Economic Issues from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().