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Interest Rate Levels and Differentials

  • Brian Scott Quinn

Abstract

This chapter is concerned not with the general determinants of interest rates but with the special features determining interest rates in the eurobond market (a full treatment of interest rate theory can be found in for example Conard).1 The approach taken will be based on loanable funds theory, as liquidity preference theory does not seem particularly appropriate in this particular market in which the reasons for investment differ greatly from those in a conventional national market, as explained below.

Keywords

Interest Rate Domestic Market International Bond Secondary Market Yield Differential 
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Notes

  1. 1.
    Coward, Introduction to the Theory of Interest Rates (Berkeley: University of California Press, 1959).Google Scholar
  2. 2.
    Analysis based on Renato Cantoni, ‘Le marché des eurobonds à l’Italie’, Banque (1966);Google Scholar
  3. discussed by G. Dufey, The Eurobond Market: Function and Future (Seattle: University of Washington Graduate School of Business Administration, 1969).Google Scholar
  4. 3.
    EEC Commission, The Development of a European Capital Market (Brussels, 1966) pp. 278–80.Google Scholar
  5. 7.
    W. J. Hopper, ‘Some Practical Aspects of Raising International Finance’, Moorgate and Wall Street Review (Autumn 1971).Google Scholar
  6. 8.
    Morri Mendelson, ‘The Eurobond and Capital Market Integration’, Journal cf Finance (Mar 1972), p. 119.Google Scholar
  7. 10.
    Morgan Guaranty Trust Co., World Financial Markets, 20 Nov 1973.Google Scholar

Copyright information

© Brian Scott Quinn 1975

Authors and Affiliations

  • Brian Scott Quinn
    • 1
  1. 1.Department of EconomicsUniversity of ReadingUK

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