What E¤ect Has Bond Market Development in Emerging Asia Had on the Issue of Corporate Bonds?

This paper investigates the determinants of the \u85rms decision to issue corporate bonds in emerging Asian economies, using a novel database covering the period 1995 to 2004. We use comparable micro level panel data for 4 countries- Indonesia, Korea, Malaysia and Thailand- to explore the inuence of \u85rmssize and growth prospects, \u85 nancial health and indicators of bond market development on the decision to issue corporate bonds. Our results show that the likelihood of bond issuance increases with size and growth prospects and with creditworthiness in all countries; there is evidence of \u85rm-level heterogeneity across \u85rm size classes. Importantly, there is no e¤ect from bond market development on the likelihood of bond issuance. We conclude that the bene\u85ts of bond market development are yet to spillover to corporate bond markets