[Econmaster2012] Research Seminar in Economics, June 23: Julian Schumacher

[Frank Stähler]

Dear all,

The next Research Seminar in Economics will take place tomorrow 
afternoon (June 23) at 2.15 pm in room E09 in Mohlstraße 36. Julian 
Schumacher from the University of Mainz will do this seminar, and the 
title of his talk will be

"Foreign Law Bonds: Can They Reduce Sovereign Borrowing Costs?"

You find an abstract of his paper below.

You find the program and paper links of the RSE under
http://www.wiwi.uni-tuebingen.de/forschung0/research-seminars/research-seminar-in-economics.html.

I am looking forward to seeing you on Tuesday afternoon.

Best wishes,
Frank Stähler


Abstract: Governments frequently issue bonds under foreign 
jurisdictions. This paper studies the price impact of jurisdiction 
choice. We test whether foreign law bonds, which are protected by the 
rule of law abroad, trade at a premium vis-à-vis domestic law bonds. We 
use the Eurozone 2006-2013 as a unique testing ground, controlling for 
currency risk, liquidity risk, and term structure. Foreign law bonds 
indeed carry significantly lower yields, but only in countries with high 
default risk (CDS spreads beyond 5%). Theseresults indicate that, in 
times of crisis, governments can borrow at lower rates under foreign law.


-- 

Frank Stähler
Professor of Economics
The University of Tübingen
frank.staehler at uni-tuebingen.de

Coordinator Doctoral Program in Economics (DPE)
http://www.uni-tuebingen.de/de/41162

Adjunct Professor of Economics
School of Economics
The University of Adelaide
frank.staehler at adelaide.edu.au

http://www.frank-staehler.de