Between 1990 and 2000, 31% of all large bankruptcies were filed in the Delaware bankruptcy court. This was a dramatic increase over the 1980 to 1990 period in which less than 1% of all bankruptcies were filed in Delaware. I empirically examine the reorganizational process of the Delaware bankruptcy court to determine the cause of the increased filings and find that CEOs who file in Delaware are nearly twice as likely to be rehired ex post . Delaware processes traditional bankruptcies faster than other courts and the findings of this paper support the position that Delaware's faster bankruptcy process mitigates some of the reputational damage suffered by the filing CEO, and that the duration of the bankruptcy process is an important determinant of CEO's reputation. Delaware also handles both traditional and prepackaged bankruptcies with less uncertainty, in terms of the standard deviation of the number of days spent in reorganization. Though firms which file a traditional bankruptcy in Delaware go through a faster, less uncertain process, upon emergence they underperform firms emerging from other venues and are more likely to refile bankruptcy in the future suggesting that CEOs act in their own best interests when choosing a bankruptcy venue.
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