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022			_a00222186
040			_aMSU _bEnglish _cMSU _erda
050	0	0	_aHB73 JOU
100	1		_aGiné, Xavier _eauthor
245	1	0	_aDo Reorganization Costs Matter for Efficiency? _bevidence from a Bankruptcy Reform in Colombia _ccreated by Xavier Giné and Inessa Love
264	1		_aChicago: _bUniversity of Chicago Press, _c2010.
336			_2rdacontent _atext _btxt
337			_2rdamedia _aunmediated _bn
338			_2rdacarrier _avolume _bnc
440			_aJournal of Law and Economics _vVolume 53, number 4
520	3		_aAn efficient bankruptcy system should liquidate nonviable businesses and reorganize viable ones. The importance of this filtering process has long been recognized in the literature; the typical reason advanced for its failure has been biases (in codes or among judges). In this paper we show that bankruptcy costs can be another source of such filtering failure. We illustrate this with the Colombian reform of 1999. Using data from 1,924 firms filing for bankruptcy between 1996 and 2003, we find that the pre reform reorganization proceedings were so inefficient that the bankruptcy system failed to separate economically viable firms from inefficient ones. In contrast, by streamlining the reorganization process, the reform contributed to the improvement of the selection of viable firms into reorganization. In this sense, the new law increased the efficiency of the bankruptcy system in Colombia.
650			_aBanks and Banking Reform
650			_aCorporate Law
650			_aEconomic Theory and Research
700	1		_aLove, Inessa _eco author
856			_uhttps://doi.org/10.1086/605848
942			_2lcc _cJA
999			_c164399 _d164399