Bankruptcy laws function as safety nets that encourage commercial risk-taking.

Evidence

People are willing to take risks, provided the risks are not too great. More people will walk a tightrope when they see a net underneath. Bankruptcy laws are nets that catch falling merchants. They can survive to work and take risks again. Perhaps, precisely because law and society in the United States encourages risk-​taking, its bankruptcy laws, in the end, have been more generous and forgiving than in most other countries. — Lawrence M. Friedman, A History of American Law, 1597