The document discusses factors that influence the yield spread between corporate bonds and government bonds. It notes that prior research viewed yield spreads as mainly driven by expected default losses, tax premiums, and risk premiums. However, more recent research has identified additional factors like equity volatility, liquidity, interest rate levels, and the slope of the treasury term structure. The literature review examines how these additional factors, such as equity volatility, impact corporate bond yield spreads relative to government bonds.