87 Am. Bankr. L.J. 27 (2013)
The Effects of a Statute (BAPCPA) Designed to Make It More Difficult for People to File for Bankruptcy

handle is hein.journals/ambank87 and id is 33 raw text is: The Effects of a Statute (BAPCPA)
Designed to Make it More Difficult for
People to File for Bankruptcy
Stephen J. Spurr and Kevin M. Ball*
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005
(BAPCPA) made the greatest changes in the Bankruptcy Code since its en-
actment in 1978. It was designed to emphasize personal responsibility and to
reduce the number of people filing for bankruptcy, in particular consumers seek-
ing relief under chapter 7. A major consequence of BAPCPA was the decline.
in total bankruptcy filings per capita. Our estimation suggests that, ceteris
paribus, BAPCPA has reduced the personal bankruptcy rate (including both
chapter 7 and chapter 13) by forty four percent between 2004 and 2011. We
also analyzed the trends in (1) the fraction of chapter 7 petitions for which the
U.S. Trustee made a motion to dismiss, and (2) the proportion of chapter 7
petitions that were actually dismissed, rather than having the motion to dismiss
withdrawn or denied. After BAPCPA, the U.S. Trustees and courts dismissed
more chapter 7 cases as abusive. Another objective of BAPCPA was to estab-
lish uniform criteria for chapter 7 petitions and, therefore, eliminate the variabil-
ity across judicial districts and states that occurred when judges applied their
own individualized standards of abusiveness. This prompted an investigation of
whether after BAPCPA, there was less variance across states in (1) the fraction
of petitions subject to a motion to dismiss and (2) the fraction of petitions
actually dismissed. In both cases, however, there was no significant change in
the variance before and after BAPCPA.
The objective of this article is to determine how certain key parties in-
volved in the bankruptcy process-debtors, United States Trustees (U.S.
Trustees),' and bankruptcy judges-actually responded to a major change in
*Stephen J. Spurr is a professor of economics at Wayne State University. Kevin M. Ball is a senior
lecturer in the Irvin D. Reid Honors College at Wayne State University. The authors express their
appreciation to the Executive Office for United States Trustees, and in particular Philip Crewson,
Thomas Kearns, and Larry Wahlquist, for their assistance in producing the data used in this article.
'As used throughout this article, U.S. Trustee refers to the officials appointed by the Attorney
General of the United States to serve as United States Trustees, pursuant to 11 U.S.C.  581. 'The


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