2007•The Blackwell Encyclopedia of SociologyRequires access
Bankruptcy
Claudia W. Scholz, Juanita M. Firestone
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Abstract
Bankruptcy or insolvency is a legal status in which a debtor is deemed unable to meet obligations to creditors. Bankruptcy usually involves some combination of debtor asset liquidation, payment rescheduling, and the discharge of remaining debts. Legal frameworks governing bankruptcy around the world vary in the degree to which they seek to serve the interests of creditors, debtors, or society at large.