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Replication data for: Consumer Bankruptcy: A Fresh Start

Version
V0
Resource Type
Dataset
Creator
  • Livshits, Igor
  • MacGee, James
  • Tertilt, Michèle
Publication Date
2007-03-01
Description
  • Abstract

    Consumer bankruptcy provides partial insurance against bad luck, but, by driving up interest rates, makes life-cycle smoothing more difficult. We argue that to assess this trade-off one needs a quantitative model of consumer bankruptcy with three key features: life-cycle component, idiosyncratic earnings uncertainty, and expense uncertainty (exogenous negative shocks to household balance sheets). We find that transitory and persistent earnings shocks have very different implications for evaluating bankruptcy rules. More persistent shocks make the bankruptcy option more desirable. Larger transitory shocks have the opposite effect. Our findings suggest the current US bankruptcy system may be desirable for reasonable parameter values. (JEL D14, D91, K35)
Availability
Download
Relations
  • Is supplement to
    DOI: 10.1257/aer.97.1.402 (Text)
Publications
  • Livshits, Igor, James MacGee, and Michèle Tertilt. “Consumer Bankruptcy: A Fresh Start.” American Economic Review 97, no. 1 (February 2007): 402–18. https://doi.org/10.1257/aer.97.1.402.
    • ID: 10.1257/aer.97.1.402 (DOI)

Update Metadata: 2020-05-18 | Issue Number: 2 | Registration Date: 2019-12-07

Livshits, Igor; MacGee, James; Tertilt, Michèle (2007): Replication data for: Consumer Bankruptcy: A Fresh Start. Version: V0. ICPSR - Interuniversity Consortium for Political and Social Research. Dataset. https://doi.org/10.3886/E116263