The paper analyzes and quantifies the importance of sovereign risk in determining corporate default premia (yield spreads). It also investigates the extent to which the practice by rating agencies and banks of not rating companies higher than their sovereign (quot;country or sovereign...

The aim of this paper is to identify the macroeconomic determinants of sovereign bond spreads in Argentina, Brazil and Mexico and discuss the economic policies underlying the divergent fortunes experienced by these countries over 1993-2001. Based on a consistent theoretical framework (unlike a...