A Comparison of Business Bankruptcies Across Industries in Canada, 1981-2000
18 Pages Posted: 25 Jan 2001
Date Written: December 2000
We analyze the effect of bankruptcy law, free trade, the GST, and various macroeconomic variables on the number of business bankruptcy filings in each of the 7 major sectors of the Canadian economy from January 1981 to March 2000. Industry regressions indicate that the introduction of the Bankruptcy and Insolvency Act in 1992 increased the number of bankruptcies in the Wholesale and Retail Trade industries and Service industries and decreased the number of bankruptcies in Primary industries and Transportation. We also find that the money supply and the exchange rate have significant impacts on the number of bankruptcies.
Keywords: Bankruptcy law, free trade, insolvency
JEL Classification: G33, G38
Suggested Citation: Suggested Citation