Trends in Personal Insolvency in Australia

150 Pages Posted: 24 Mar 2009

See all articles by Ian Ramsay

Ian Ramsay

Melbourne Law School - University of Melbourne

Cameron Sim

University of Melbourne - Centre for Corporate Law and Securities Regulation

Date Written: March 23, 2009

Abstract

In this study we identify and discuss trends in personal insolvency in Australia. By personal insolvency, we mean bankruptcy, debt agreements and personal insolvency agreements under the Bankruptcy Act. We examine data on the number of personal insolvencies for the period 1990 to 2008 and on the characteristics of personal insolvents for the period 1997 to 2008. Key findings include: (1) a significant increase (261%) in the number of personal insolvents over the time period studied - far exceeding the increase in population; (2) changes over time in the reasons for this increase (for example, increases in excessive use of credit, ill health, and gambling or other speculation leading to personal insolvency); (3) significant changes in the characteristics of personal insolvents (for example, bankrupts are now older and have more dependants).

We find evidence that personal insolvency in Australia is becoming more of a middle class phenomenon. Personal insolvents are increasingly coming from higher status occupations; have increasing levels of personal income and household income; and have increasing asset and property ownership levels.

Keywords: bankruptcy, personal insolvency

Suggested Citation

Ramsay, Ian and Sim, Cameron, Trends in Personal Insolvency in Australia (March 23, 2009). U of Melbourne Legal Studies Research Paper No. 390. Available at SSRN: https://ssrn.com/abstract=1367445 or http://dx.doi.org/10.2139/ssrn.1367445

Ian Ramsay (Contact Author)

Melbourne Law School - University of Melbourne ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia
+61 3 8344 5332 (Phone)

HOME PAGE: http://law.unimelb.edu.au/about/staff/ian-ramsay

Cameron Sim

University of Melbourne - Centre for Corporate Law and Securities Regulation ( email )

Victoria 3010
Australia

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