A Game theoretic model on post-insolvency procedures

This thesis utilizes the game theory literature with asymmetric information to model post-insolvency options of the indebted firm. We center the study on Turkish bankruptcy system and compare the system to an alternative state, which is namely the Benchmark state. In the first state, the indebted firm has three options: Liquidation, Reorganization, and Adjournment of Bankruptcy; while the last option, which is unique to Turkish system, is not available in the latter. These two systems are compared in terms of resulting welfare of the creditor. The comparison indicates that the Benchmark state generally serves better to creditor. However, in certain cases this relation is reversed and effects of the changes in model parameters in these two states are different.