New factors driving EM corporate leverage – RBI paper
Changed macroeconomic backdrop has taken over from firm-specific factors
Patterns of corporate borrowing in emerging market economies (EMEs) appear to have changed in the period following the 2008 financial crisis, according to research published on March 15 by the Reserve Bank of India (RBI).
Snehal Herwadkar’s paper Corporate Leverage in EMEs: Has the Global Financial Crisis Changed the Determinants?, finds it was the “changed macroeconomic scenario” rather than firm-specific factors that has driven the build-up of corporate leverage in emerging markets.
“Macroec
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