This paper provides a new insight into the relationship between financial market tightness and real activity using a unique new database extracted from Bloomberg to construct a credit spread index from 500 corporate bonds issued in eight European countries. We find that European bond spread...

Our paper focuses on testing the advantages in controlling the buyer and salvaging goods supplied where we have information on the nature of the transacted good and information on the inventory of buyers and sellers. We find transactions in specialized goods tend to be conducted more often using...

Empirical investigation of the external finance premium has been conducted on the margin between internal finance and bank borrowing or equities but little attention has been given to corporate bonds especially for the emerging Asian market. In this paper we hypothesize that balance sheet...

The growth of unsecured household credit relative to income has been marked in recent years and many observers have questioned whether it is sustainable. This paper develops a theory-based empirical model of equilibrium household consumption and credit. The equilibrium relationships are embedded...

Corporate bond issuance has followed an upward trend in the last decade that has tripled the volume of corporate public debt. There is a long literature on reasons why firms choose this option, which has recently explored the influence of a firm’s reputation on the decision to go public. The...

Much of the literature on interest rate pass through assumes banks set retail rates in relation to contemporary market rates. We argue that future rates also matter, and if forecasts of future rates are included, the empirical specifications of many previous studies are misspecified. Including...

Making accurate predictions of corporate credit ratings is a crucial issue to both investors and rating agencies. Recent events have drawn attention to ratings agencies methods. In this paper we investigate the determinants of credit ratings as a function of financial variables; we then consider...

Trade credit is an important source of finance for firms and has been well researched, but the focus has been on financial trade-offs. In this paper, we consider the trade-offs with inventories and develop a simple model that recognizes the incentives a firm faces to offer and receive trade...

This paper investigates the determinants of the firm's decision to issue corporate bonds in emerging Asian economies, using a novel database covering the period 1995 to 2004. We use comparable micro level panel data for 4 countries - Indonesia, Korea, Malaysia and Thailand - to explore the...

This paper investigates the role of trade credit in the transmission of monetary policy. Most models of the transmission mechanism allow firms to access only financial markets or bank lending according to some net worth criterion. In our model we consider external finance from trade credit as an...