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What determines the ability of low-income developing countries to issue bonds in international capital and what explains the spreads on these bonds? This paper examines these questions using a dataset that includes emerging markets and developing economies (EMDEs) that issued sovereign bonds at least once during the period 1995-2013 as well as those that did not. We find that an EMDE is more likely to issue a bond when, in comparison with non-issuing peers, it is larger in economic size, has higher per capita GDP, and has stronger macroeconomic fundamentals and government. Spreads on sovereign bonds are lower for countries with strong external and fiscal positions, as well as robust economic growth and government effectiveness. With regard to global factors, the results show that sovereign bond spreads are reduced in periods of lower market volatility.

Banks and Banking --- Finance: General --- Investments: Bonds --- Macroeconomics --- International Lending and Debt Problems --- International Financial Markets --- Macroeconomic Analyses of Economic Development --- General Financial Markets: General (includes Measurement and Data) --- Fiscal Policy --- Interest Rates: Determination, Term Structure, and Effects --- Investment & securities --- Finance --- Sovereign bonds --- Fiscal stance --- Yield curve --- International bonds --- International capital markets --- Financial institutions --- Fiscal policy --- Financial services --- Financial markets --- Bonds --- Interest rates --- Capital market --- United States

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This paper reassesses the impact of trade liberalization on productivity. We build a new, unique database of effective tariff rates at the country-industry level for a broad range of countries over the past two decades. We then explore both the direct effect of liberalization in the sector considered, as well as its indirect impact in downstream industries via input linkages. Our findings point to a dominant role of the indirect input market channel in fostering productivity gains. A 1 percentage point decline in input tariffs is estimated to increase total factor productivity by about 2 percent in the sector considered. For advanced economies, the implied potential productivity gains from fully eliminating remaining tariffs are estimated at around 1 percent, on average, which do not factor in the presumably larger gains from removing existing non-tariff barriers. Finally, we find strong evidence of complementarities between trade and FDI liberalization in boosting productivity. This calls for a broad liberalization agenda that cuts across different areas.

Tariff --- Free trade --- Industrial productivity --- Productivity, Industrial --- TFP (Total factor productivity) --- Total factor productivity --- Industrial efficiency --- Production (Economic theory) --- Free trade and protection --- Trade, Free --- Trade liberalization --- International trade --- Ad valorem tariff --- Border taxes --- Customs (Tariff) --- Customs duties --- Duties --- Fees, Import --- Import controls --- Import fees --- Tariff on raw materials --- Commercial policy --- Indirect taxation --- Revenue --- Customs administration --- Favored nation clause --- Non-tariff trade barriers --- Reciprocity (Commerce) --- Econometric models. --- Econometric models --- E-books --- Exports and Imports --- Taxation --- Production and Operations Management --- Trade Policy --- International Trade Organizations --- Empirical Studies of Trade --- International Investment --- Long-term Capital Movements --- Economic Growth of Open Economies --- Institutions and Growth --- Production --- Cost --- Capital and Total Factor Productivity --- Capacity --- Macroeconomics: Production --- Public finance & taxation --- Macroeconomics --- Finance --- International economics --- Tariffs --- Foreign direct investment --- Productivity --- Taxes --- Balance of payments --- Investments, Foreign --- Ireland