Online appendix to Financial distress, stock returns, and the 1978 Bankruptcy Reform Act
- We study the effect of weakening creditor rights on distress risk premia via a bankruptcy reform that shifts bargaining power in financial distress toward shareholders. We find that the reform reduces risk factor loadings and returns of distressed stocks. The effect is stronger for firms with lower firm-level shareholder bargaining power. An increase in credit spreads of riskier relative to safer firms, in particular for firms with lower firm-level shareholder bargaining power, confirms a shift in bargaining power from bondholders to shareholders. Out-of-sample tests reveal that a reversal of the reform's effects leads to a reversal of factor loadings and returns.
Author: | Dirk Hackbarth, Rainer HaselmannGND, David Schoenherr |
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URN: | urn:nbn:de:hebis:30:3-370877 |
URL: | http://ssrn.com/abstract=2517596 |
DOI: | https://doi.org/10.2139/ssrn.2517596 |
Document Type: | Report |
Language: | English |
Year of Completion: | 2014 |
Year of first Publication: | 2014 |
Publishing Institution: | Universitätsbibliothek Johann Christian Senckenberg |
Release Date: | 2015/07/27 |
Tag: | financial distress; law and finance; shareholder recovery; stock returns |
Issue: | October 31, 2014 |
Page Number: | 3 |
Last Page: | 2 |
Note: | The paper "Financial Distress, Stock Returns, and the 1978 Bankruptcy Reform Act" to which these Appendices apply is available at the following URL: http://ssrn.com/abstract=1787627 |
HeBIS-PPN: | 362914907 |
Institutes: | Wirtschaftswissenschaften / Wirtschaftswissenschaften |
Wissenschaftliche Zentren und koordinierte Programme / House of Finance (HoF) | |
Wissenschaftliche Zentren und koordinierte Programme / Center for Financial Studies (CFS) | |
Wissenschaftliche Zentren und koordinierte Programme / Sustainable Architecture for Finance in Europe (SAFE) | |
Dewey Decimal Classification: | 3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft |
Sammlungen: | Universitätspublikationen |
Licence (German): | Deutsches Urheberrecht |