The Empirical Reseach On Credit Spreads Of Chinese Corporate Bonds From The Micro Level

Credit spreads reflect the risk of default.Many domestic and overseascholars and experts had made research on default risk pricing model andempirical analysis. It is critical that whether these pricing models andresults of studies can be used in China’s bond market, especially thecorporate bonds.The history of corporate bonds in America can be traced back to100years ago. But in China, the history of corporate bonds is less than10years. With the rapid development of China’s financial market andeconomy, as an important direct financing instrument, we can foresee thatcorporate bonds will play a more critical role in China’s capital market.In this paper, firstly, we will introduce the history and the currentsituation of China’s corporate bonds and compare them with other directfinancing tool in China. Thenwe will choose explanatory variablesaccording to the different famous default risk pricing models and theoriesand do empirical research from micro level. At the end, we will concludethe influence of these variables and explain the logic of their relations andprovide our suggestion to China’s bond market.