Restructuring Economies In Distress

In 1980 the World Bank began structural adjustment lending to its member governments to support broad economic, institutional, and policy reforms. To examine how well this form of lending has worked, this volume brings together leading practitioners and scholars from the World Bank and other financial institutions as well as from government and academia. Their assessments, based on theoretical and practical experience, contribute to the ongoing debate about how best to bring about macroeconomic stability. Case studies of nine countries under adjustment explore how well they complied with loan conditions and how their economies performed before, during, and after adjustment.

Philipp Jostarndt studies distress-induced changes in ownership and control, success factors in distressed equity infusions, and firms’ choice between in- and out-of-court debt restructurings. In addition, he analyzes the determinants of survival, acquisition, and bankruptcy as alternative paths to exit financial distress. He includes both the firm perspective as well as the market valuations of the undertaken restructurings and, where applicable, relates the findings to the microstructure of Germany’s revised bankruptcy legislation.

An analytical account of the current crisis of global capitalism. Kolko examines what the global capitalist system means today--for the United States, Japan, and Western Europe, for the less developed nations, and for the centrally planned economies of Eastern Europe, Russia, and China. The author's analysis moves from changes in banking and the service sector to the new technology industries; the dilemmas of world debt, efforts to restructure world trade, and the nature of monetary relations. Kolko describes the various strategies to restructure the global economy and maintains that reform on a national scale cannot begin to cope with the crisis. She shows how and why the diverse efforts to restructure the global order reflect the character of the current crisis. ISBN 0-394-55920-7: $24.95.

A comprehensive look at the enormous growth and evolution of distressed debt markets, corporate bankruptcy, and credit risk models This Fourth Edition of the most authoritative finance book on the topic updates and expands its discussion of financial distress and bankruptcy, as well as the related topics dealing with leveraged finance, high-yield, and distressed debt markets. It offers state-of-the-art analysis and research on U.S. and international restructurings, applications of distress prediction models in financial and managerial markets, bankruptcy costs, restructuring outcomes, and more.

"A compilation of policy-relevant research by a multidisciplinary group of scholars on the state of families in rural America in the twenty-first century. Examines the impact of economic restructuring on rural Americans and provides policy recommendations for addressing the challenges they face"--Provided by publisher.

Sovereign debt restructurings are associated with declines in GDP, investment, bank credit, and capital flows. The transmission channels and associated output and banking sector costs depend on whether the restructuring takes place preemptively, without missing payments to creditors, or whether it takes place after a default has occurred. Post-default restructurings are associated with larger declines in bank credit, an increase in lending interest rates, and a higher likelihood of triggering a banking crisis than pre-emptive restructurings. Our local projection estimates show large declines in GDP, investment, and credit amplified by severe sudden stops and transmitted through a “capital inflow-credit channel”.

The private non-financial sector in Europe is facing increased challenges in meeting its debt servicing obligation. In response, governments are revisiting legal tools and—in some cases—institutional arrangements to deal with over-indebtedness. For households, where the problem in some countries is large but no established best practice exists, reforms have generally sought to allow debtors a fresh start while minimizing moral hazard and preserving bank solvency and credit discipline. For the corporate sector, efforts have focused on facilitating debt restruturing (including through out of court mechanisms). Direct government intervention has been rare.