Inclusion of 'spatial effects' help explain Colombian money market spreads, central bank paper argues


Traditional factors, such as size, leverage and borrowing levels cannot by themselves explain borrowing spreads in the Colombian money markets, according to a Central Bank of Colombia working paper.

The Cost of Collateralized Borrowing in the Colombian Money Market: Does Connectedness Matter? by Constanza Martínez and Carlos León, argues, however, that "inclusion of spatial effects" (network effects) of the same traditional factors results in a model "able to explain the existence of borrowing

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