What Effect Has Bond Market Development in Emerging Asia Had on the Issuance of Corporate Bonds?
This paper investigates the determinants of firms' decision to issue public debt in emerging Asian economies, using a novel database covering the period 1995 to 2007. We use comparable micro level panel of eight countries - China, Hong Kong, Indonesia, Korea, Malaysia, Philippines, Singapore and Thailand - to explore the influence of firms' characteristics and indicators of bond market depth on the decision to issue corporate bonds. Our paper demonstrates the influence of firm-specific characteristics on the decision to issue bonds, especially an indicator that the firm made previous issues of bonds. It also finds that the effect of market liquidity and local market size on the decision is small but significant. Finally our results show that co-ordinated policies by national governments to encourage bond market development have had little impact on probability of bond issuance at the firm level in Asia.
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- Cantillo, Miguel & Wright, Julian, 2000.
"How Do Firms Choose Their Lenders? An Empirical Investigation,"
Review of Financial Studies,
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- Galina Hale, 2003.
"Bonds or Loans? The Effect of Macroeconomic Fundamentals,"
Yale School of Management Working Papers
ysm343, Yale School of Management, revised 01 Apr 2007.
- Galina Hale, 2007. "Bonds or Loans? the Effect of Macroeconomic Fundamentals," Economic Journal, Royal Economic Society, vol. 117(516), pages 196-215, 01.
- Galina Hale, 2003. "Bonds or Loans? The Effect of Macroeconomic Fundamentals," Cowles Foundation Discussion Papers 1403, Cowles Foundation for Research in Economics, Yale University, revised Sep 2005.
- Demirguc-Kunt, Asli & Maksimovic, Vojislav, 1999. "Institutions, financial markets, and firm debt maturity," Journal of Financial Economics, Elsevier, vol. 54(3), pages 295-336, December.
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