This paper shows how national approaches to consumer insolvency and debt relief are shaped by the diversity of economic models, welfare state regimes and legal traditions. I conceptualize consumer bankruptcy and its actors, aims and building blocks, discuss consumer bankruptcy as new economic and social policy in finance-driven capitalism, and classify the consumer bankruptcy systems of 15 advanced economies based on a theory-driven classificatory framework, a new dataset, and hierarchical cluster analyses. Four models of consumer debt relief are discerned, which differ in their substantial rules and their underlying normative orientations towards debtors, creditors and the economic and public sphere: a ‘market model’ which offers a quick ‘fresh start’ for insolvent individuals; a ‘restrictions model’ that imposes economic, political and civil restrictions and disqualifications on debtors; a ‘liability model’ which emphasizes the debtor’s responsibility for debt repayment; and a ‘mercy model’ which focuses on the debtor’s deservingness for debt relief.
