Veiled Politics

Abstract

This article explores the connection between bankruptcy and organizational failure, arguing that the two have grown increasingly distinct in the world of large corporate bankruptcy. In some bankruptcy cases, the filing of a Chapter 11 petition has very little to do with organizational failure in the strictest sense but instead signals a change in organizational strategy by corporate management or institutional creditors. This article suggests viewing bankruptcy as a specialized organizational field that offers significant advantages to corporations facing complex dilemmas. As a highly structured organizational field, bankruptcy favors repeat players, privileges financial epistemologies over other forms of knowledge, transforms threatening stakeholder interests into more familiar creditor claims, and channels larger political disputes into narrower financial disputing frameworks.

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