Is there any economic theory and econometric models for personal bankruptcy? Especially using aggregate data.
It's clearly when the liabilities, present & future are unable to be paid from the present and future cash-flows and liquidation of assets held.
I think when bank liquidity is not sufficient to pay for its process,also when all equity less than liabilities, also when bank expenses is more than revenues
Do you mean an aggregate model of personal bankruptcy? That is, is hte dependent variable the population rate of personal bankruptcy? Or do you mean a model of individual bankruptcy (i.e. the dependent variable is binary -- insolvent versus not insolvent)?
it is important notes for the mangers that analysis of ratios such as ROA,ROE, and leverage ,also liquidity ratio of bank can give a big sign
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