Arbeitspapier
The Impact of Fiscal Governance on Bond Markets: Evidence from Late Budgets and State Government Borrowing Costs
Does fiscal governance affect government borrowing costs? We operationalize fiscal governance as the ability of governments to pass a budget on time and, using a unique data set on budget enactment dates, analyze the effect of such late budgets on government bond yield spreads. Based on a sample of 36 US states in the period 1988-1997, we estimate that a budget delay of 30 days has a long run impact on the yield spread between 2 and 10 basis points. States with sufficient liquidity in the form of large reserves face small or no costs from late budgets.
- Language
-
Englisch
- Bibliographic citation
-
Series: EPRU Working Paper Series ; No. 2010-11
- Classification
-
Wirtschaft
State and Local Budget and Expenditures
National Budget; Budget Systems
National Debt; Debt Management; Sovereign Debt
- Subject
-
fiscal governance
political deadlock
late budgets
fiscal stalemate
Chubb relative value survey
debt cost
bond spreads
Finanzpolitik
Öffentliche Schulden
Kapitalkosten
Länderfinanzen
USA
- Event
-
Geistige Schöpfung
- (who)
-
Andersen, Asger Lau
Dreyer Lassen, David
Holbøll Westh Nielsen, Lasse
- Event
-
Veröffentlichung
- (who)
-
University of Copenhagen, Economic Policy Research Unit (EPRU)
- (where)
-
Copenhagen
- (when)
-
2010
- Handle
- Last update
-
10.03.2025, 11:42 AM CET
Data provider
This object is provided by:
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ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Andersen, Asger Lau
- Dreyer Lassen, David
- Holbøll Westh Nielsen, Lasse
- University of Copenhagen, Economic Policy Research Unit (EPRU)
Time of origin
- 2010
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