Socio-economic consequences of bankruptcy of individuals

Abstract

The bankruptcy of individuals has become especially relevant. This is confirmed by numerous commercials about bankruptcy on the Internet and on television, which were practically non-existent before. This article discusses the causes and consequences of bankruptcy of individuals. First of all, this process affects the debtor and the creditor, but it indirectly affects the country as a whole. The authors studied the world experience on the problem of bankruptcy of individuals and conducted a comparative analysis for different countries, conducted and transcribed in-depth interviews with lawyers and arbitration managers, conducted a questionnaire among citizens who entered bankruptcy proceedings, and compiled a “portrait of the average debtor”. The authors pointed out the pressing problems faced by citizens and creditors in the bankruptcy process, described the reasons why people enter bankruptcy, showed how economic sanctions and the COVID-19 pandemic affected the growth of bankruptcy, demonstrated the dynamics of bankruptcy of individuals in Russia and in foreign countries, gave a forecast of possible developments related to with the bankruptcy of individuals. The novelty of the article and the author’s contribution consists in the introduction into scientific circulation of the definition “leniency”, which reflects the real economic, sociological and legal situation in a particular country on key grounds — such as the presence of direct bankruptcy; its acceptability; prices (costs); complexity; dynamics of the process; conditions and possibilities of debt repayment during its restructuring; real problems of bankruptcy stigmatization.