State Bankruptcy Law and Entrepreneurship: Evidence from a Border Analysis

Amanda Ross () and Shawn Rohlin ()

ERSA conference papers from European Regional Science Association

Abstract: This paper examines how differences in state bankruptcy laws, specifically the amount of the homestead exemption, affect business location decisions. We expand upon the literature by narrowing the geographic scope and focus on the amount of entrepreneurial activity within a few miles of the state boundary. By including only these border areas, we are more effectively able to control for unobserved local attributes, which are important determinants of business location decisions. Findings indicate that an increase in a state's homestead exemption attracts new businesses to that locality. In addition, we do not find that a more generous homestead exemption has a negative impact on existing businesses. Our results suggest that bankruptcy law is an important policy tool that state governments can use to attract new businesses, without experiencing an adverse effect on existing enterprises.

Keywords: bankruptcy; entrepreneurship; borders (search for similar items in EconPapers)
Date: 2013-11
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www-sre.wu.ac.at/ersa/ersaconfs/ersa13/ERSA2013_paper_00253.pdf (application/pdf)

Related works:
Working Paper: State Bankruptcy Law and Entrepreneurship: Evidence from a Border Analysis (2014)
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:wiw:wiwrsa:ersa13p253

Access Statistics for this paper

More papers in ERSA conference papers from European Regional Science Association Welthandelsplatz 1, 1020 Vienna, Austria.
Bibliographic data for series maintained by Gunther Maier ().