Personal Bankruptcies

The Political Economy of Property Exemption Laws

“…30 To investigate more rigorously our hypotheses regarding the decision to opt out, we ran logit regressions with the dependent variable a dummy equal to one if the state has ever opted out and zero if not. The first independent variable is a dummy equal to one if the state's homeowner exemptions are 26 See Erik Berg!Of & Howard Rosenthal, The Political Economy of American Bankruptcy: The Evidence from Roll Call Voting, 1800-1978(unpublished manuscript, Princeton Univ. 1999.…”

Rehabilitation or Liquidation: Consumers' Choices in Bankruptcy

“…As evidenced by a number of empirical studies (Apilado et al 1978;Sullivan and Worden 1988), the prohibition or more severe restriction of garnishment is associated with significantly lower rates of nonbusiness bankruptcy in cross-state analyses of the incidence of bankruptcy, holding other things constant. Thus, one may assume that the net benefit to debtors of bankruptcy under these conditions is lower than the net benefit of outright default.…”

The Law and Economics of Consumer Finance

“…These studies generally tind that states with laws that are more restrict ive of the ability of a creditor to garnIsh a debtor's wages have higher filing rates. See, for exampl e, Apilado, Dauten, and Smith ( 1978); Ellis (1998a), and Heck ( 198 1). Although thi s effect could be due to higher repayment rates, it is more plausibl y due to the ability of defaulting debtors to protect their future incomes without filin g fo r bankruptcy.…”

“…See, for example, Apilado, Dauten, and Smith ( 1978) (fi nding mi xed results when testing for a link between exemptions and the filing rate before to the enactment o f the Bankruptcy Reform Act o f 1978), PeterSon and Aoki ( 1984), and Shiers and Williamson ( 1987) .…”