دانلود رایگان مقاله انگلیسی تاخیر ورشکستگی و پویایی شرکت ها - اشپرینگر 2018

Abstract

The present paper explores the link between bankruptcy law and firms’ dynamics, focusing on Italy as a case study. Relying on a previous literature dealing with the concept of entrepreneurship “friendly” bankruptcy law, we stress the idea that bankruptcy institutions, although connected to a painful event for firms, might still yield beneficial consequences on a societal level. In particular, we find evidence that quicker judicial resolutions of liquidation bankruptcies have an impact on firms’ entry and exit rates in Italy, by reducing the indirect costs that a bankrupt firm must undergo and allowing a quicker reallocation of assets towards more efficient destinations. Such effect is related with firms’ organizational structure and size.

5 Concluding remarks

Bankruptcy indeed represents a negative and painful event in the life cycle of a firm. However, if the institutional setting in which these events occur is welldesigned and properly enforced, also bankruptcies can yield beneficial consequences for entrepreneurship. This is exactly what is meant by the term entrepreneurship “friendly” bankruptcy law. Previous works have highlighted how differences in risk-taking and entrepreneurship levels might be explained by various characteristics of bankruptcy law. The main findings of this stream of literature is that, although bankruptcy is commonly considered as an institution regarding the “exit” of firms from markets, it is also relevant for their “entry”.

Among the various elements that define the friendliness towards entrepreneurship of a bankruptcy system, we were able to identify the temporal length of its judicial enforcement as the only component varying within Italy. We have stressed that longer judicial delays should determine an increase in the “indirect” costs connected to bankruptcy and a relatively less efficient allocation of resources. Accordingly, we have hypothesized a negative effect of bankruptcy delay on firms’ entry and exit. In order to test this conjecture, we have employed data on the enforcement of bankruptcy procedures from the 165 Italian judicial districts. Our results suggest that bankruptcy delay prevents both perspective firms to enter markets and insolvent business to exit. However, the significance of this effect depends on businesses’ entrepreneurial forms. Either mixed or insignificant results are found for incorporated limited liability companies or soleproprietorships. On the contrary, partnerships of multiple entrepreneurs sharing personal liability seem to be the economic activities mostly influenced by differences in the friendliness of bankruptcy law. This can be explain by the fact that collective firms are the ones more likely to be affected by the consequences of a bankruptcy procedure. Their business magnitude is generally greater than the one of self-employed entrepreneurs, thus more is at stake. However, the fact that such entrepreneurs share their personal liability makes their activity more risky and thus more likely to be influenced by the harsh consequences of a bankruptcy.