Was wissen wir über Betriebsschließungen? Erkenntnisse für West- und Ostdeutschland
This paper reports the results of several investigations into the determinants of company shutdowns using administrative data for Germany. We show that between 1975 and 2008, the average shutdown rate has risen considerably in western Germany. For most of the time, shutdown rates in eastern Germany were higher, but they have converged to the western level recently. The shutdown risk falls with company size and is substantially higher for young companies. Shutdown rates initially decline as companies age, reaching a minimum at ages 15 to 18, and then rise again. Companies begin to shrink several years before closure, and the remaining workforce becomes on average more skilled, more female and older in companies about to close compared to surviving ones.
Equity and Bond Market Signals as Leading Indicators of Bank Fragility
Journal of Money, Credit and Banking,
We analyse the ability of the distance to default and subordinated bond spreads to signal bank fragility in a sample of EU banks. We find leading properties for both indicators. The distance to default exhibits lead times of 6-18 months. Spreads have signal value close to problems only. We also find that implicit safety nets weaken the predictive power of spreads. Further, the results suggest complementarity between both indicators. We also examine the interaction of the indicators with other information and find that their additional information content may be small but not insignificant. The results suggest that market indicators reduce type II errors relative to predictions based on accounting information only.
Bankruptcy in Russia: A never-ending-story
IWH Discussion Papers,
Personal Bankruptcy and Credit Supply and Demand
Quarterly Journal of Economics,
This paper examines how personal bankruptcy and bankruptcy exemptions affect the supply and demand for credit. While generous state-level bankruptcy exemptions are probably viewed by most policy-makers as benefiting less-well-off borrowers, our results using data from the 1983 Survey of Consumer Finances suggest that they increase the amount of credit held by high-asset households and reduce the availability and amount of credit to low-asset households, conditioning on observable characteristics. Thus, bankruptcy exemptions redistribute credit toward borrowers with high assets. Interest rates on automobile loans for low-asset households also appear to be higher in high exemption states.