05408oam 22013694 450 991015489950332120230808205516.01-4755-4550-91-4755-4555-X(CKB)4340000000018100(MiAaPQ)EBC4745296(IMF)WPIEA2016204(EXLCZ)99434000000001810020020129d2016 uf 0engurcnu||||||||rdacontentrdamediardacarrierBenefits and Costs of Corporate Debt Restructuring : An Estimation for Korea /Jae Chung, Lev RatnovskiWashington, D.C. :International Monetary Fund,2016.1 online resource (23 pages) illustrations, tablesIMF Working Papers1-4755-4541-X The paper offers a method to quantify benefits and costs of corporate debt restructuring, with an application to Korea. We suggest a "persistent ICR<1" criterion to capture firms that had ICR<1 for multiple consecutive years and thus will likely require restructuring. We assess the benefits of debt restructuring by estimating the effects of removing a firm's debt overhang on its investment and hiring decisions. We refine the assumptions on the cost of debt restructuring based on the literature, and focus not only on creditor losses, but also on the employment impact of corporate restructuring. Benchmark results for Korea suggest 5.5-7.5 percent of GDP creditor losses and a 0.4-0.9 percent of the labor force employment impact from the debt restructuring. These are compensated by a permanent 0.4-0.9 percentage points increase in future GDP growth thanks to higher corporate investment and 0.05-0.1 percent of labor force higher hiring in the subsequent years. The key qualitative result is that corporate debt restructurings "pay off" in the medium term: their economic cost is recouped over about 10 years.IMF Working Papers; Working Paper ;No. 2016/204Corporate debtKorea (South)Econometric modelsDebt reliefKorea (South)Econometric modelsExports and ImportsimfFinancial Risk ManagementimfLaborimfIndustries: ManufacturingimfInvestmentimfCapitalimfIntangible CapitalimfCapacityimfBusiness FluctuationsimfCyclesimfBankruptcyimfLiquidationimfDebtimfDebt ManagementimfSovereign DebtimfEmploymentimfUnemploymentimfWagesimfIntergenerational Income DistributionimfAggregate Human CapitalimfAggregate Labor ProductivityimfLabor Force and Employment, Size, and StructureimfInternational Lending and Debt ProblemsimfIndustry Studies: Manufacturing: GeneralimfFinanceimfLabourimfincome economicsimfInternational economicsimfManufacturing industriesimfDebt restructuringimfLabor forceimfDebt burdenimfManufacturingimfAsset and liability managementimfExternal debtimfEconomic sectorsimfDebts, ExternalimfEconomic theoryimfLabor marketimfKorea, Republic ofimfCorporate debtEconometric models.Debt reliefEconometric models.Exports and ImportsFinancial Risk ManagementLaborIndustries: ManufacturingInvestmentCapitalIntangible CapitalCapacityBusiness FluctuationsCyclesBankruptcyLiquidationDebtDebt ManagementSovereign DebtEmploymentUnemploymentWagesIntergenerational Income DistributionAggregate Human CapitalAggregate Labor ProductivityLabor Force and Employment, Size, and StructureInternational Lending and Debt ProblemsIndustry Studies: Manufacturing: GeneralFinanceLabourincome economicsInternational economicsManufacturing industriesDebt restructuringLabor forceDebt burdenManufacturingAsset and liability managementExternal debtEconomic sectorsDebts, ExternalEconomic theoryLabor market658.1526Chung Jae1378330Ratnovski Lev1193852DcWaIMFBOOK9910154899503321Benefits and Costs of Corporate Debt Restructuring3651388UNINA