Coase-Sandor Institute for Law & Economics Research Paper Series
Publication Date
2025
Publication Title
Coase-Sandor Working Paper Series in Law and Economics
Abstract
This Essay asks how bankruptcy judges ought to orient their substantial, statutory discretion in business reorganization cases. The motivating observation is that bankruptcy law enacts a kind of forced integration of productive assets. To shed light on the contemporary problems that bankruptcy judges face, I thus look to two classic approaches to the economic theory of the firm-from Oliver Williamson and from Oliver Hart. I conclude that nonjudicial institutions have largely surmounted the problems to which their theories point, leaving a different, and probably narrower, set of issues to worry about. Bankruptcy judges who have a notion that their job is, in part, to push parties to a "deal" should instead focus on policing efforts by some of a debtor's investors to capture value from a recapitalization deal to which their pre-distress bargain does not entitle them.
Number
26-2
Recommended Citation
Buccola, Vincent S.J., "Bankruptcy Judging After Williamson" (2025). Coase-Sandor Institute for Law & Economics Research Paper Series. 26-2.
https://chicagounbound.uchicago.edu/law_and_economics/1132
