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Bankruptcy - Explained

What is Bankruptcy?

Written by Jason Gordon

Updated at September 26th, 2021

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Table of Contents

What is bankruptcy?Discussion QuestionAcademic Research

What is bankruptcy?

Bankruptcy is both a status and system of laws aimed at protecting individuals and businesses (collectively, individual). An individual is bankrupt when she is insolvent or the value of her debts exceeds the value of her assets. The bankruptcy system is a body of laws that allows for the elimination or restructuring of an individuals debt. The underlying objective of the system is to rehabilitate and allow for the future prosperity of the individual. The bankruptcy process is the subject of this chapter.

Next Article: Types of Bankruptcy Back to: BANKRUPTCY LAW

Related Topics

  • What is Bankruptcy?
  • Insolvency - Definition
  • What are the types of business bankruptcy?
  • Chapter 9 Bankruptcy
  • Chapter 12 Bankruptcy
  • Chapter 15 Bankruptcy  

Discussion Question

How do you feel about the concept of allowing individuals to eliminate or restructure their debt? What effect do you think this ability has on economic activity and productivity in society? What arguments can you provide for and against this system?

Academic Research on Bankruptcy


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