NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

The Pricing of Bonds and Bank Loans in International Markets: An Empirical Analysis of Developing Countries' Foreign Borrowing

Sebastian Edwards

NBER Working Paper No. 1689 (Also Reprint No. r0762)
Issued in August 1985
NBER Program(s):   ITI   IFM

The purpose of this paper is to compare the pricing of bank loans and bonds in international markets. The results obtained, using data on LDC debtors, indicate that in both markets the country risk premium has responded to some of the variables suggested by the theory. However, the way in which these variables affect the risk premium differs across these markets. Data on LDC bond yields in the secondary market for 1980-85 are also used to analyze the way in which this market reacted and anticipated the debt crisis.

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Document Object Identifier (DOI): 10.3386/w1689

Published: Edwards, Sebastian. "The Pricing of Bonds and Bank Loans in International Markets: An Empirical Analysis of Developing Countries' Foreign Borrowing," European Economic Review, Vol. 30, No. 3, (June 1986), pp. 565-589.

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