Abstract
This dissertation examines the determinants of corporate bond yield spreads in developed and emerging countries. Against the fixed effects benchmark, the Pooled Mean Group regression is implemented on a panel dataset covering the period, 2014 to 2020. This study looked at 9 countries, 8 industries and 33 companies. The study applied company, industry and country specific variables identified from reviewed literature as regressors of corporate bond yield spreads. The panel is grouped by country, industry, and market development. The results of the study indicated that the determinants of yield spreads differ across developed and emerging markets. Equity volatility, exchange rate and inflation were significant in explaining yield spreads in emerging countries only. Developed markets results indicated that interest rates are significant in explaining yield spreads. Additionally, in general yield spreads are likely to be lower than in emerging markets. Industry and country effects were significant in explaining variations in corporate bond yield spreads.
M.Com. (Financial Economics)