Dejan Kovač, Ph.D.

Dejan Kovač, Ph.D.
Current Position

since 9/21

Economist in the Department of Structural Change and Productivity

Halle Institute for Economic Research (IWH) – Member of the Leibniz Association

Research Interests

  • international economics
  • behavioural economics
  • political economy

Dejan Kovač joined the Department of Structural Change and Productivity in September 2021. His research focuses on international economics, behavioural economics, and political economy.

Dejan Kovač received his bachelor's degree from University of Zagreb, his master's degree and his PhD from Center for Economic Research and Graduate Education – Economics Institute in Prag. Prior to joining IWH, he was a researcher at Princeton University.

Your contact

Dejan Kovač, Ph.D.
Dejan Kovač, Ph.D.
Mitglied - Department Structural Change and Productivity
Send Message +49 345 7753-862 Personal page

Publications

Working Papers

cover_DP_2021-10.jpg

The Impact of Delay: Evidence from Formal Out-of-Court Restructuring

Randall K. Filer Dejan Kovač Jacob N. Shapiro Stjepan Srhoj

in: IWH Discussion Papers, No. 10, 2021

Abstract

Bankruptcy restructuring procedures are used in most legal systems to decide the fate of businesses facing financial hardship. We study how bargaining failures in such procedures impact the economic performance of participating firms in the context of Croatia, which introduced a „pre-bankruptcy settlement“ (PBS) process in the wake of the Great Recession of 2007 - 2009. Local institutions left over from the communist era provide annual financial statements for both sides of more than 180,000 debtor-creditor pairs, enabling us to address selection into failed negotiations by matching a rich set of creditor and debtor characteristics. Failures to settle at the PBS stage due to idiosyncratic bargaining problems, which effectively delays entry into the standard bankruptcy procedure, leads to a lower rate of survival among debtors as well as reduced employment, revenue, and profits. We also track how bargaining failures diffuse through the network of creditors, finding a significant negative effect on small creditors, but not others. Our results highlight the impact of delay and the importance of structuring bankruptcy procedures to rapidly resolve uncertainty about firms‘ future prospects.

read publication
Mitglied der Leibniz-Gemeinschaft LogoTotal-Equality-LogoWeltoffen Logo