Investor base and corporate borrowing: Evidence from international bonds

• 成果类型: Article
• 署名作者: Massa, Massimo; Zaldokas, Alminas
• 署名单位: INSEAD Business School; Hong Kong University of Science & Technology
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2013.11.002
• 发表日期: 2014
• 页码: 95-110
• 关键词: International bond issues; International bond ownership; Investor recognition hypothesis; International diversification

摘要

We examine international bond issues by US firms to study the benefits of investor taste for cross-border security issuances. We proxy for firms' international investor taste with the fraction of prior international bond holding in firms' domestic and international bonds and find that international investor demand increases with such taste. Moreover, the offering yield spreads on international bonds are lower than domestic offering yield spreads for these internationally recognized firms and they have higher probability of issuing internationally. Such international recognition may occur, for instance, if the diversification benefits of adding the security to investor's portfolio outweigh the negative effects of higher renegotiation costs for international compared to domestic investors. (C) 2013 Elsevier B.V. All rights reserved.