Arbeitspapier

The Political Determinants of Government Bond Holdings

This paper analyzes the link between political factors and sovereign bond holdings of US investors in 60 countries over the 2003-2013 period. We find that, in general, US investors hold more bonds in countries with few political constraints on the government. Moreover, US investors respond to increased uncertainty around major elections by reducing government bond holdings. These effects are particularly significant in democratic regimes and countries with sound institutions, which enable effective implementation of fiscal consolidation measures or economic reforms.

Language
Englisch

Bibliographic citation
Series: IWH Discussion Papers ; No. 14/2016

Classification
Wirtschaft
Portfolio Choice; Investment Decisions
International Financial Markets
General Financial Markets: Government Policy and Regulation
Structure, Scope, and Performance of Government
National Debt; Debt Management; Sovereign Debt
Subject
government bond portfolio
political factors
Treasury International Capital data
PPML

Event
Geistige Schöpfung
(who)
Eichler, Stefan
Plaga, Timo
Event
Veröffentlichung
(who)
Leibniz-Institut für Wirtschaftsforschung Halle (IWH)
(where)
Halle (Saale)
(when)
2016

Handle
URN
urn:nbn:de:gbv:3:2-54619
Last update
10.03.2025, 11:43 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Eichler, Stefan
  • Plaga, Timo
  • Leibniz-Institut für Wirtschaftsforschung Halle (IWH)

Time of origin

  • 2016

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