It’s important to distinguish between firms that are merely distressed and those that are no longer viable. Does the current corporate bankruptcy system provide the most efficient means to this end?
By Stephen Slivinski
Caballero, Ricardo J., Takeo Hoshi, and Anil K. Kashyap. “Zombie Lending and Depressed Restructuring in Japan.” National Bureau of Economic Research Working Paper No. 12129, April 2006.
Zywicki, Todd J. “Bankruptcy,” in The Concise Encyclopedia of Economics, ed. David R. Henderson. Indianapolis: Liberty Fund Inc., 2007.