| Summary: | We examine trends in bankruptcy completion times and financial characteristics for farmers filing for chapter 12 bankruptcy after it became a permanent fixture in bankruptcy law to assess justifications for the recently enacted Family Farmer Bankruptcy Clarification Act of 2017 and Family Farmer Relief Act of 2019. Since 2007, chapter 12 filers have seen noticeable increases in their debt levels whereas alternative business bankruptcies have either stagnated or declined in their debt. Using survival analysis methods to correct for the censored nature of open cases, we find that the average time to completion has consistently been longer for chapter 12 than the comparable chapters (7, 11, and 13) of business bankruptcies. Although chapter 12 completion times have not been increasing over time, we find that chapter 7 and 11 completion times have been declining over time for comparable businesses and that debt levels are a significant factor in increased completion times. Our results are consistent with claims that farmers have had rising debt levels in comparison to similar businesses filing for bankruptcy and provide evidence that farmers with increasing debt have had a more difficult time restructuring through chapter 12. EconLit citations: G33, K35, Q14, Q18. © 2020 The Authors. Agribusiness Published by Wiley Periodicals LLC
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