Teams and bankruptcy



Publishing details

CEPR Discussion Paper

Authors / Editors

Baghai R; Silva R; Ye L

Publication Year



We study the impact of corporate bankruptcies on teams and inventor productivity in the United States. We show that bankruptcy reduces team stability. After a bankruptcy, team inventors produce fewer and less impactful patents, and they are more likely to cease patenting. This points to the loss of team-specific human capital as a cost of resource reallocation through bankruptcy. Our findings also suggest that the labor market values teams and their stability. Past collaboration increases the probability of inventors jointly moving to a new firm after bankruptcy, and the productivity of inventors that relocate together with their team increases.


Bankruptcy; Creative destruction; Innovation; Labor productivity; Team-specific human capital; Teams; Teamwork

Series Number



CEPR Discussion Paper