More to Lose: The Attributes of Involuntary Bankruptcy
Lucinda O'Brien, Malcolm Anderson, Ian Ramsay, Paul Ali
ECONOMIC PAPERS | WILEY | Published : 2019
While the majority of those who declare bankruptcy do so voluntarily, a significant proportion are forced into bankruptcy as a result of legal action. This paper interrogates data obtained from the Australian Financial Security Authority to explore the attributes of debtors who go bankrupt involuntarily. Based on this analysis, the authors hypothesise that people who go bankrupt involuntarily are those who have more to lose by going bankrupt – such as a family home, a business venture or a managerial or professional occupation – meaning that they are more likely to resist bankruptcy until they are forced into it by their creditors.
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Awarded by Australian Research Council
This research has been supported by the Australian Research Council (Linkage Grant LP130101022). The authors gratefully acknowledge the assistance of the Statistics team at the Australian Financial Security Authority. They particularly wish to thank River Paul for the time and expertise she has contributed to this research project.