Selecting the Best Form

Abstract

In this chapter the analysis switches from positive to normative. DS is discussed first, but ultimately dismissed on the ground that the creditor does not benefit from increased growth of the debtor. DS adds to liquidity, but not solvency. As regards the choice between RS and BM, it is argued that BM leads 3–2; but, more significant than the quantitative lead, is the areas in which BM leads. These are: a probable lead in preventing bankruptcy; the provision of an anti-cyclical tool; and the feasibility of providing a solution which avoids the danger of the debtor facing large bills as a result of statistical modernization; versus relative stability of the stock price and the avoidance of perverse resource transfers.