A Note on the Determinants of the Outcomes of Bankruptcy Petitions: Evidence From Korea
利用1977至1994年韩国企业数据，发现自由资产多、流动资产少、存续期长、规模大、经营风险低、商誉高的企业更可能通过破产重组存活，其中自由资产比例影响最显著。
This study provides evidence on the determinants of the outcomes of bankruptcy petitions using Korean firms for the period from 1977 to 1994. We hypothesize that a firm with more free assets, less liquid assets, longer existing period, larger size, lower operating risk, and more goodwill would have higher survival prospects from the bankruptcy petition. The results from logit estimation confirm this hypothesis. The free assets, existing period, firm size, and goodwill have positive influence on the probability of reorganization, while the liquid assets, and operating risk are negatively related to the probability of reorganization. Among these variables, the free assets percentage is the most significant at the one percent level in determining the outcomes of bankruptcy petitions. This reveals that a bankrupt firm with more free assets tends to be reorganized because it would be easy to obtain additional financing needed for the successful reorganization. The liquid assets and existing period are also significant at the five percent level. We conclude that a firm with more free assets, less liquid assets, and longer existing period would have higher survival prospects in Korea.