Regulatory Protection and Opportunistic Bankruptcy*
研究发现，在弱投资者保护环境下，控股股东会故意调低利润以符合破产条件，从而侵占债权人利益，这对采用资产负债表测试破产资格的国家具有警示意义。
ABSTRACT We document controlling shareholder (insider) opportunism in an insolvency regime that uses an accounting rule to determine bankruptcy eligibility. Our study sheds light on managerial incentives induced by weak investor protection laws. Using unique data on bankrupt firms from an emerging market, consistent with our prediction, we show insiders intentionally manage earnings downward to understate firm net worth so as to be able to file for bankruptcy. Downward pre‐bankruptcy earnings management is associated with more payments to insiders and weaker performance, post‐filing. A battery of tests suggests our results cannot be fully explained as an artifact of financial distress. Rather, they are consistent with insiders exploiting weak investor protection to extract private benefits at the expense of lenders and outside shareholders. Our study serves as a cautionary tale for all insolvency regimes that use a balance sheet test in an environment with weak creditor protection.