Hengel, Erin 
ORCID: 0000-0002-2039-3521
Rescue Culture.
[Internet Publication]
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Abstract
In a comprehensive debt-financing model, I show rescue-centric corporate bankruptcy anticipates motives creditors do not have. Although out-of-court settlements dominate and formal procedures are rarely used, insolvent borrowers nevertheless extract concessions from creditors unless supervised reorganisation is 100 percent free. They pay for it, unfortunately, with inefficient continuation and liquidation, expensive debt and credit-rationing. Ironically, rescue culture hits hardest the firms is meant to save yet benefits creditors, whom it claims to check. Firms with long expected lifespans are either the first denied credit or the first to make investment choices that guarantee premature liquidation. Creditors, meanwhile, enjoy a profitable niche lending market in an otherwise highly competitive industry.
| Item Type: | Internet Publication |
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| Depositing User: | Symplectic Admin |
| Date Deposited: | 21 Jan 2021 11:02 |
| Last Modified: | 18 Jan 2023 23:02 |
| Related URLs: | |
| URI: | https://livrepository.liverpool.ac.uk/id/eprint/3114402 |
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