ENTERPRISE INSOLVENCY AND THE EFFECTS ON THE LOCAL AND REGIONAL COMMUNITY - THE SOCIAL ECONOMY PERSPECTIVE

Abstract

In the article examines the issue enterprise insolvency and the effect it has on local and regional communities. Due to the first symptoms of insolvency, such as difficulty or an inability to settle liabilities when they come due, a model was adopted for the dependent variable level of commitments. The companies are divided into two groups - those, whose level of commitment was less than the median, and those, whose level was higher. It was found that companies with excessive level of commitments are more exposed to the risk of insolvency. The research enabled the identification of determinants for forming commitments. It is very important that the inability of just one company to meet its obligations can have significant consequences for the local market. While the phenomenon, as manifested in the insolvency transfer for the following entities may be a significant factor in negative circumstances affecting the wider community - the regional approach.