Table 1 Sample selection procedure and...

Table 1

Sample selection procedure and characteristics of bankrupt firms (1987–2015)

Panel A: Sample selection procedure	Firm-years	Firms
Firms with data available in CRSP, COMPUSTAT and SDC between 1950 and 2015	258,087	24,247
Less
Duplicates	(76,088)	(2,000)
Missing data	(161,966)	(18,204)
Firm-years with negative total assets or book value of equity, price per share lessthan $1 and market value of equity less than $10 million	(311)	(224)
Negative CR	(2,286)	(1,329)
Financial services firms (6,000 series SIC code) and regulated industry firms (4,000 series SIC code);	(1,637)	(411)
Total firms (1987–2015)	17,799	3,492
Bankrupt firms (financially distressed and filed for Chapter 11)	584	276
Non-bankrupt firms	12,097	1,516
Total bankrupt and non-bankrupt firms	12,681	1,792
Others	5,118	1,700
After matching (1987–2014)	1,152	602
Bankrupt firms	576	273
Non-bankrupt firms	576	329

Panel A: Sample selection procedure	Firm-years	Firms
Firms with data available in CRSP, COMPUSTAT and SDC between 1950 and 2015	258,087	24,247
Less
Duplicates	(76,088)	(2,000)
Missing data	(161,966)	(18,204)
Firm-years with negative total assets or book value of equity, price per share lessthan $1 and market value of equityless than $10 million	(311)	(224)
Negative CR	(2,286)	(1,329)
Financial services firms (6,000 series SIC code) and regulated industry firms (4,000 series SIC code);	(1,637)	(411)
Total firms (1987–2015)	17,799	3,492
Bankrupt firms (financially distressed and filed for Chapter 11)	584	276
Non-bankrupt firms	12,097	1,516
Total bankrupt and non-bankrupt firms	12,681	1,792
Others	5,118	1,700
After matching (1987–2014)	1,152	602
Bankrupt firms	576	273
Non-bankrupt firms	576	329

Panel B: Time distribution of bankrupt firms from 1987 to 2014
Year	Frequency	% of bankrupt firms
1987	3	0.52
1988	28	4.86
1989	32	5.56
1990	22	3.82
1991	17	2.95
1992	21	3.65
1993	25	4.34
1994	32	5.56
1995	42	7.29
1996	31	5.38
1997	33	5.73
1998	52	9.03
1999	43	7.47
2000	24	4.17
2001	16	2.78
2002	17	2.95
2003	16	2.78
2004	11	1.91
2005	16	2.78
2006	25	4.34
2007	18	3.13
2008	4	0.69
2009	4	0.69
2010	11	1.91
2011	6	1.04
2012	11	1.91
2013	9	1.56
2014	7	1.22
Total	576	100.00

Panel B: Time distribution of bankrupt firms from 1987 to 2014
Year	Frequency	% of bankrupt firms
1987	3	0.52
1988	28	4.86
1989	32	5.56
1990	22	3.82
1991	17	2.95
1992	21	3.65
1993	25	4.34
1994	32	5.56
1995	42	7.29
1996	31	5.38
1997	33	5.73
1998	52	9.03
1999	43	7.47
2000	24	4.17
2001	16	2.78
2002	17	2.95
2003	16	2.78
2004	11	1.91
2005	16	2.78
2006	25	4.34
2007	18	3.13
2008	4	0.69
2009	4	0.69
2010	11	1.91
2011	6	1.04
2012	11	1.91
2013	9	1.56
2014	7	1.22
Total	576	100.00

Panel C: Industry distribution of bankrupt firms from 1987 to 2014 according to Fama and French (1997)
2-digit SIC	Industry name	No. of observations	Percentage of bankrupt firms
21	Machinery	10	1.74
22	Electrical equipment	19	3.30
23	Automobiles and trucks	27	4.69
24	Aircraft	3	0.52
25	Shipbuilding and railroad equipment	4	0.69
27	Precious metals	6	1.04
28	Nonmetallic and industrial metal mining	2	0.35
29	Coal	1	0.17
30	Petroleum and natural gas	63	10.94
33	Personal services	15	2.60
34	Business services	76	13.19
35	Computers	38	6.60
36	Electronic equipment	44	7.64
37	Measuring and control equipment	3	0.52
38	Business supplies	36	6.25
39	Shipping containers	1	0.17
41	Wholesale	41	7.12
42	Retail	118	20.49
43	Restaurants, hotels and motels	69	11.98
Total		576	100.00

Panel C: Industry distribution of bankrupt firms from 1987 to 2014 according to Fama and French (1997)
2-digit SIC	Industry name	No. of observations	Percentage of bankrupt firms
21	Machinery	10	1.74
22	Electrical equipment	19	3.30
23	Automobiles and trucks	27	4.69
24	Aircraft	3	0.52
25	Shipbuilding and railroad equipment	4	0.69
27	Precious metals	6	1.04
28	Nonmetallic and industrial metal mining	2	0.35
29	Coal	1	0.17
30	Petroleum and natural gas	63	10.94
33	Personal services	15	2.60
34	Business services	76	13.19
35	Computers	38	6.60
36	Electronic equipment	44	7.64
37	Measuring and control equipment	3	0.52
38	Business supplies	36	6.25
39	Shipping containers	1	0.17
41	Wholesale	41	7.12
42	Retail	118	20.49
43	Restaurants, hotels and motels	69	11.98
Total		576	100.00

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