Personal Bankruptcy Law, Fresh Starts, and Judicial Practice

Personal Bankruptcy Law, Fresh Starts, and Judicial Practice

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Régis Blazy & Bertrand Chopard & Eric Langlais & Ydriss Ziane, 2011. « Personal Bankruptcy Law, Fresh Starts, and Judicial Practice, » EconomiX Working Papers 2011-15, University of Paris West – Nanterre la Défense, EconomiX.

We explore the ways French judges respond to the possibility of discharging personal debts in exchange for liquidation of debtors’ assets. We present empirical results on the determinants of judicial selection between debtors whose debts are wiped out and those who have to reimburse them. We find that French judges tend to disqualify debtors with multiple creditors from debt discharge, and are sensitive to regional labor market conditions. These empirical results help us understand better how French personal bankruptcy laws perform compared to other national systems. Finally, our results serve to fill the gap between bankruptcy rules and judicial practice.

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