The Virtue of Consumer Bankruptcy

Heidi M. Hurd, David C. Baum

Research output: Chapter in Book/Report/Conference proceedingChapter


This chapter lays out the foundations for a new positive theory of the consumer bankruptcy discharge that better coheres with common normative commitments and more persuasively explains doctrines that centrally define and limit today's right of discharge. It argues that our practices of debt-forgiveness are not about maximizing aggregate welfare, or about protecting individual rights, or about spreading wealth so as to achieve a more just distribution across society. Rather, they are about achieving and expressing personal virtue-not that of creditors or of debtors but of ordinary people, as citizens of a just and wealthy society. In short, the bankruptcy system is about the people, it is not about them; it is an institution required by persons of good character who live in a world of scarce resources with others of variable talents, dispositions, opportunities, and luck. It reflects the aggregation and coordination of the demands of the best "aretaic" theory-the best theory of what it means to be a person possessed of sound moral character within a society of unequally distributed benefits and burdens. When debtors are rightly forgiven, it is under circumstances in which all those to whom their debts are owed ought to forgive their debts, and all those to whom the costs of their default are passed ought to be willing to shoulder those losses.

Original languageEnglish (US)
Title of host publicationA Debtor World
Subtitle of host publicationInterdisciplinary Perspectives on Debt
PublisherOxford University Press
ISBN (Electronic)9780199980000
ISBN (Print)9780199873722
StatePublished - Jan 24 2013
Externally publishedYes


  • Bankruptcy system
  • Consumer bankruptcy discharge
  • Debt
  • Debt-forgiveness
  • Personal virtue

ASJC Scopus subject areas

  • General Social Sciences


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