Template-Type: ReDIF-Paper 1.0
Author-Name: Viv B Hall 
Author-X-Name-First: Viv
Author-X-Name-Last: Hall
Author-Email: viv.hall@vuw.ac.nz
Author-Workplace-Name: Victoria University of Wellington
Author-Name: C John McDermott
Author-X-Name-First: John
Author-X-Name-Last: McDermott
Author-Email: john.mcdermott@motu.org.nz
Author-Workplace-Name: Motu Economic and Public Policy Research
Title: Changes in New Zealand’s Business Insolvency Rates after the Global Financial Crisis 
Abstract: We examine the question of whether the rate of business insolvencies in New Zealand is related to overall macroeconomic conditions. In particular, our interest is in whether the rate of business insolvencies changed in the wake of the Global Financial Crisis (GFC). We find that there was a large increase in insolvencies in New Zealand following the onset of the GFC in 2008. We also find that the timing of the change did not occur uniformly over the country but occurred at different times in four key regional centres. Sharply rising relative costs were the most important macroeconomic factor influencing corporate insolvencies in New Zealand, Auckland, Waikato and Wellington, but have been immaterial in determining New Zealand’s total personal insolvencies. It is employment growth and house price inflation that have been significant in explaining total personal insolvencies.
Length: 25 pages
Creation-Date: 2019-08
File-URL: https://motu-www.motu.org.nz/wpapers/19_15.pdf
Number: 19_15
Classification-JEL: G33; E32; R11
Keywords: Bankruptcy; business cycles; structural breaks; New Zealand; Global Financial Crisis 
Handle: RePEc:mtu:wpaper:19_15