Bankruptcy Shocks and Legal Labor Markets: Evidence from the Court Competition Era

• Tác giả: Chad Brown, Jeronimo Carballo, Alessandro Peri
• Ngôn ngữ: eng
• Ký hiệu phân loại: 332.75 Insolvency and credit restrictions
• Thông tin xuất bản: 2022
• Bộ sưu tập: Báo, Tạp chí
• ID: 168704

Tóm tắt

Comment: 57 pages, 7 figuresWe study how
- Chapter 11 bankruptcies affect local legal labor markets. We document that bankruptcy shocks increase county legal employment and corroborate this finding by exploiting a stipulation of the law known as Forum Shopping during the Court Competition Era (1991-1996). We quantify losses to local communities from firms forum shopping away from their local area as follows. First, we calculate the unrealized potential employment gains implied by our reduced-form results. Second, we structurally estimate a model of legal labor markets and quantify welfare losses. We uncover meaningful costs to local communities from lax bankruptcy venue laws.