Locational effects and the cost of corporate bonds

the role of information

Tao Hu, Xiaolu Hu, Haozhi Huang, Jing Shi, Hua Wang

Research output: Contribution to journalArticle

3 Citations (Scopus)

Abstract

The public yield spreads of bonds vary widely between Chinese provinces/municipalities, with the average for the highest province double that of the lowest one. Although we find that these patterns are mainly attributable to economic and legal conditions, locational effects like geographic distance and public firm credit ratings also appear to be contributory. We show that these effects are induced by different regional informational environments and are robust to controlling for potential endogenous location choices.
Original languageEnglish
Pages (from-to)1977-2016
Number of pages40
JournalAccounting and Finance
Volume59
Issue numberS2
Early online date11 Oct 2019
DOIs
Publication statusPublished - 1 Nov 2019

Keywords

  • Bond yield spreads
  • Firm location
  • Geographic peer effects
  • Information environment

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