The Belt and Road Initiative and Corporate Bond Yield Spreads
XU Si, PAN Xintong, LIN Wanfa
School of Economics and Management, South China Normal University; Lingnan College, Sun Yat-sen University; School of Economics and Management, Wuhan University
Summary:
During his visits to Central and Southeast Asia in 2013, Chinese President Xi Jinping proposed the Silk Road Economic Belt and the 21st Century Maritime Silk Road, which are together now referred to as the Belt and Road Initiative. The goal of this initiative is to strengthen infrastructure connectivity, promote the orderly and free flow of economic factors, a highly efficient allocation of resources, and the deep integration of markets. The Belt and Road Initiative provides strong impetus for economic transformation and upgrading. Hence, academic and practical circles quickly began to explore the impact of the Belt and Road Initiative on the behavior of micro-enterprises. In this paper, we investigate whether the Belt and Road Initiative has an impact on the corporate bond market. Theoretically, the Belt and Road Initiative may imply both benefits and risks for the corporate bond market. For example, the implementation of the Belt and Road Initiative reduces the corporate bond yield spreads of supported firms for the following reasons. To make progress on the Belt and Road construction, Chinese governments tend to provide financial subsidies or tax preferences for supported firms, which can directly reduce their default risk. With the in-depth development of the Belt and Road Initiative, the business environment of the supported firms will simultaneously continue to improve and the efficiency of resource allocation is expected to improve further. With the strong support of government policies, bond investors face lower default risk and choose to demand relatively low risk compensation from supported firms. Additionally, the Belt and Road Initiative can improve the information disclosure quality of supported firms as it develops. Benefiting greatly from the reduction of information asymmetry between supported firms and outsiders, the bond yield spreads of supported firms are expected to decrease. Another perspective is that the implementation of the Belt and Road Initiative will increase the corporate bond yield spreads of supported firms. From the perspective of the external environment, the existence of credit risk, legal risk, sovereignty disputes, and other problems may make supported firms' bids to “go global” fail to achieve the expected results. From the perspective of internal operations, the Belt and Road projects focus on basic investments and involve large capital investments and a low rate of return. Therefore, there are several uncertainties for Belt and Road investments. Bond investors may think that the corporate bonds issued by supported firms have high default risk and thus demand high-risk compensation. Based on the above analyses, this paper regards the Belt and Road Initiative as a quasi-natural experiment and uses a difference-in-differences model to investigate the impact of the Belt and Road Initiative on corporate bond yield spreads. The empirical results show that the Belt and Road Initiative can significantly reduce the bond yield spreads of supported firms. Analyzing the reaction of the bond market, we find that supported firms have higher CARs for bonds after the Belt and Road Initiative. The channel analysis suggests that the Belt and Road Initiative decreases bond yield spreads through both resource and information effects. Specifically, supported firms receive more government subsidies and stronger support for tax preferences. Supported firms are also associated with a decrease in information asymmetry after the Belt and Road Initiative. Exploiting cross-sectional variation, we find that the negative effect of the Belt and Road Initiative on bond yield spreads is more pronounced for firms located in key industries or in key provinces. A further analysis shows that the Belt and Road Initiative can also reduce the issue price of corporate bonds in the primary market. Regarding nonprice terms, we conclude that after the implementation of the Belt and Road Initiative, supported firms are less likely to be subject to collateral terms and tend to have less restrictive covenants. Compared with the literature, the three main contributions of this paper are as follows. First, this paper examines the effectiveness of the Belt and Road Initiative from the perspective of corporate bond yield spreads. The findings enrich the relevant literature on the consequences of the Belt and Road Initiative on micro-enterprises' financing behaviors and provides a theoretical basis and practical reference for Belt and Road policies at the bond level. Second, this paper echoes the relevant literature on policy support to provide a reference path for the government to better guide the development of enterprises with a “visible hand.” Third, this paper contributes to the factor influencing bond credit spreads by innovatively explaining the changes in corporate bond credit spreads from the perspective of the Belt and Road Initiative, which enriches the literature on macroeconomic policy and bond credit spreads.
徐思, 潘昕彤, 林晚发. “一带一路”倡议与公司债信用利差[J]. 金融研究, 2022, 500(2): 135-152.
XU Si, PAN Xintong, LIN Wanfa. The Belt and Road Initiative and Corporate Bond Yield Spreads. Journal of Financial Research, 2022, 500(2): 135-152.
[1]陈超和李镕伊,2014,《债券融资成本与债券契约条款设计》,《金融研究》第1期,第44～57页。 [2]陈胜蓝和刘晓玲,2018,《公司投资如何响应“一带一路”倡议?——基于准自然实验的经验研究》,《财经研究》第4期,第20～33页。 [3]董香书和肖翔,2017,《“振兴东北老工业基地”有利于产值还是利润?——来自中国工业企业数据的证据》,《管理世界》第7期,第24～34页。 [4]金刚和沈坤荣,2019,《中国企业对“一带一路”沿线国家的交通投资效应:发展效应还是债务陷阱》,《中国工业经济》第9期,第79～97页。 [5]李建军和李俊成,2020,《“一带一路”倡议、企业信贷融资增进效应与异质性》,《世界经济》第2期,第3～24页。 [6]黎绍凯和张广来,2018,《我国对“一带一路”沿线国家直接投资布局与优化选择:兼顾投资动机与风险规避》,《经济问题探索》第9期,第111～124页。 [7]李笑影和李玲芳,2018,《互联网背景下应对“一带一路”贸易风险的机制设计研究》,《中国工业经济》第12期,第97～114页。 [8]李曜和谷文臣,2020,《债转股的财富效应和企业绩效变化》,《财经研究》第7期,第107～121页。 [9]林晚发、钟辉勇和李青原,2018,《高管任职经历的得与失?——来自债券市场的经验证据》,《金融研究》第6期,第171～188页。 [10]卢盛峰和陈思霞,2017,《政府偏袒缓解了企业融资约束吗?——来自中国的准自然实验》,《管理世界》第5期,第51～65页。 [11]卢伟和李大伟,2016,《“一带一路”背景下大国崛起的差异化发展策略》,《中国软科学》第10期,第11～19页。 [12]罗长远和曾帅,2020,《“走出去”对企业融资约束的影响——基于“一带一路”倡议准自然实验的证据》,《金融研究》第10期,第92～112页。 [13]吕越、陆毅、吴嵩博和王勇,2019,《“一带一路”倡议的对外投资促进效应——基于2005—2016年中国企业绿地投资的双重差分检验》,《经济研究》第9期,第187～202页。 [14]孙焱林和覃飞,2018,《“一带一路”倡议降低了企业对外直接投资风险吗?》,《国际贸易问题》第8期,第66～79页。 [15]王桂军和卢潇潇,2019a,《“一带一路”倡议可以促进中国企业创新吗?》,《财经研究》第1期,第19～34页。 [16]王桂军和卢潇潇,2019b,《“一带一路”倡议与中国企业升级》,《中国工业经济》第3期,第43～61页。 [17]王桂军和张辉,2020,《“一带一路”与中国OFDI企业TFP:对发达国家投资视角》,《世界经济》第5期,第49～72页。 [18]王雄元和高开娟,2017a,《客户集中度与公司债二级市场信用利差》,《金融研究》第1期,第130～144页。 [19]王雄元和高开娟,2017b,《如虎添翼抑或燕巢危幕:承销商,大客户与公司债发行定价》,《管理世界》第9期,第42～59页。 [20]王永钦和吴娴,2019,《中国创新型货币政策如何发挥作用:抵押品渠道》,《经济研究》第12期,第86～101页。 [21]徐光、赵茜和王宇光,2019,《定向支持政策能缓解民营企业的融资约束吗?——基于民营企业债务融资支持工具政策的研究》,《金融研究》第12期,第187～206页。 [22]徐浩萍和杨国超,2013,《股票市场投资者情绪的跨市场效应——对债券融资成本影响的研究》,《财经研究》第2期,第47～57页。 [23]许红梅和李春涛,2020,《社保费征管与企业避税——来自〈社会保险法〉实施的准自然实验证据》,《经济研究》第6期,第122～137页。 [24]徐思、何晓怡和钟凯,2019,《“一带一路”倡议与中国企业融资约束》,《中国工业经济》第7期,第155～173页。 [25]杨兴全、尹兴强和孟庆玺,2018,《谁更趋多元化经营:产业政策扶持企业抑或非扶持企业?》,《经济研究》第9期,第133～150页。 [26]于蔚、汪淼军和金祥荣,2012,《政治关联和融资约束:信息效应与资源效应》,《经济研究》第9期,第125～139页。 [27]朱杰,2019,《“一带一路”倡议与资本市场信息效率》,《经济管理》第9期,第38～56页。 [28]Bharath, S. T., J. Sunder and S. V. Sunder. 2008. “Accounting Quality and Debt Contracting,”, The Accounting Review, 83(1):1～28. [29]Bharath, S. T., S. Dahiya and A. Saunders. 2011. “Lending Relationships and Loan Contract Terms,”, Review of Financial Studies, 24(4):1141～1203. [30]Gao, K. and W. Lin. 2018. “Margin Trading, Short Selling, and Bond Yield Spread,”, China Journal of Accounting Research, 11(1):51～70. [31]Gong, G., S. Xu and X. Gong. 2018. “On the Value of Corporate Social Responsibility Disclosure: An Empirical Investigation of Corporate Bond Issues in China,”, Journal of Business Ethics, 150(1):227～258. [32]Graham, J. R., S. Li and J. Qiu. 2008. “Corporate Misreporting and Bank Loan Contracting,”, Journal of Financial Economics, 89(1):44～61. [33]Huang, Y. 2016. “Understanding China's Belt & Road Initiative: Motivation, Framework and Assessment,”, China Economic Review, 40:314～321. [34]Luo, C., Q. Chai and H. Chen. 2019. “ ‘Going Global' and FDI Inflows in China: ‘One Belt & One Road' Initiative as a Quasi‐natural Experiment,”, The World Economy, 42(6):1654～1672.
