How firms use domestic and international corporate bond markets

Juan Carlos Gozzi (), Ross Levine (), Maria Soledad Martinez Peria and Sergio Schmukler

No 6209, Policy Research Working Paper Series from The World Bank

Abstract: This paper provides the first comprehensive documentation of how firms use domestic and international corporate bond markets. Debt issues in domestic and international markets have different characteristics, not explained by differences across firms or countries. International issues tend to be larger, of shorter maturity, denominated in foreign currency, include more fixed rate contracts, and entail lower yields. These patterns remain when analyzing issues by firms from countries with more developed domestic markets and higher financial integration, and even when comparing issues conducted by the same firm in different markets. These findings are consistent with the views that (1) frictions limit the ability of investors and firms to enter into certain contracts in certain markets, (2) domestic and international markets provide distinct financial services and firms use them as complements, and (3) firms with access to domestic and international markets enjoy advantages relative to those that rely solely on domestic markets.

Keywords: Debt Markets; Emerging Markets; Markets and Market Access; Microfinance; Currencies and Exchange Rates (search for similar items in EconPapers)
Date: 2012-09-01
New Economics Papers: this item is included in nep-fmk, nep-ifn and nep-opm
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Citations: View citations in EconPapers (12)

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Working Paper: How Firms Use Domestic and International Corporate Bond Markets (2012)
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