Innovations in Bankruptcy--Pricing the Priority of Insolvency Claims
Author: Chad Leechor Date: 9/1/1999 (PDF, 200KB)
Many developing countries are trying to establish effective bankruptcy systems, generally modeling them on those of advanced countries. But there is much dissatisfaction with bankruptcy frameworks in advanced countries too. Some alternatives have been proposed. One is an options-based approach that provides an objective way of pricing creditor claims according to priority. With allowances for local conditions, this approach offers developing countries a chance to leapfrog existing bankruptcy practices and their limitations.