From 1600 to 1991 : The History and Future of Bankruptcy

Abstract

The purpose of this paper is to look at the origin, the development, and the future of bankruptcy in the United States. How is bankruptcy perceived, and can bankruptcy be predicted, are questions that will be answered. The paper will first look at the history of modern bankruptcy and the people who founded it. The paper will then explain the current Code that was enacted in 1979 with attention given to important Chapters and aspects of that code. While no legislation is perfect, the faults and problems of the Code will be presented and discussed. Next, through the use of a recent example, the paper examines the effect bankruptcy has on the economy, and finally, a model is discussed that predicts whether or not a firm will be forced into bankruptcy. From the research conducted during this project, and through my work with Chrysler Credit, I believe that the current bankruptcy system used in the United states is superior than those systems used in the past. While this is true, the code must continue to adapt to the ever changing economic climate, or our economy could face serious problems.