Blame technology for bankruptcies
Technological progress has a significant effect on the bankruptcy rate, a new paper from the Richmond Federal Reserve posits.
The research finds that technological progress in information technology has led to a drop in information costs for lenders, the result of which was that previously borrowing-constrained households could now be screened and so obtain more debt. The analysis shows that the rise in debt generates bankruptcy fillings because the benefits of filing for bankruptcy increases
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