EconPapers    
Economics at your fingertips  
 

The Impact of Bankruptcy Reform on Insolvency Choice and Consumer Credit

Jason Allen () and Kiana Basiri ()

Staff Working Papers from Bank of Canada

Abstract: We examine the impact of the 2009 amendments to the Canadian Bankruptcy and Insolvency Act on insolvency decisions. Rule changes steered debtors out of division I proposals and into the more cost-effective division II proposals. This also led to a significant substitution out of bankruptcies and into proposals. Using credit bureau data on credit card limits we test, but do not find, any evidence that this substitution into more creditor-friendly insolvencies had any impact on average lending behavior, either immediately following the amendments or up to six years removed.

Keywords: Credit and credit aggregates; Financial Institutions; Financial system regulation and policies (search for similar items in EconPapers)
JEL-codes: D14 G2 K35 (search for similar items in EconPapers)
Pages: 44 pages
Date: 2016
New Economics Papers: this item is included in nep-ban and nep-law
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
https://www.bankofcanada.ca/wp-content/uploads/2016/05/swp2016-26.pdf

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:bca:bocawp:16-26

Access Statistics for this paper

More papers in Staff Working Papers from Bank of Canada 234 Wellington Street, Ottawa, Ontario, K1A 0G9, Canada. Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2022-08-07
Handle: RePEc:bca:bocawp:16-26