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Can Credit Rating Agencies Affect Election Outcomes?, Igor Cunha, Miguel A. Ferreira, Rui C. Silva
Can Credit Rating Agencies Affect Election Outcomes?, Igor Cunha, Miguel A. Ferreira, Rui C. Silva
Institute for the Study of Free Enterprise Working Papers
We show that credit rating agencies can have a significant effect on election outcomes. We identify these effects by exploiting exogenous variation in municipal bond ratings due to Moody’s recalibration of its scale in 2010. We find that incumbent politicians in upgraded municipalities experience an increase in their likelihood of reelection and their vote shares. These rating upgrades improve voters’ opinions about the incumbent and produce positive wealth effects through voters’ holdings of local municipal bonds. In addition, rating upgrades cause an expansion of local governments’ debt capacity that allows the incumbent to increase spending and improve local economic conditions.
Essays On External Forces In Capital Markets, Marcus Painter
Essays On External Forces In Capital Markets, Marcus Painter
Theses and Dissertations--Finance and Quantitative Methods
In the first chapter, I find counties more likely to be affected by climate change pay more in underwriting fees and initial yields to issue long-term municipal bonds compared to counties unlikely to be affected by climate change. This difference disappears when comparing short-term municipal bonds, implying the market prices climate change risks for long-term securities only. Higher issuance costs for climate risk counties are driven by bonds with lower credit ratings. Investor attention is a driving factor, as the difference in issuance costs on bonds issued by climate and non-climate affected counties increases after the release of the 2006 …
Conduit Bond Financing Of Local Governments—Perspective From The U.S. And China, Zihe Guo
Conduit Bond Financing Of Local Governments—Perspective From The U.S. And China, Zihe Guo
Theses and Dissertations--Public Policy and Administration
As an alternative way to issue bonds, conduit financing has been widely used by local governments and nonprofit organizations. Conduit financing allows one entity to issue debt on behalf of single or multiple borrowers. In the state of California in the U.S., a local agency is allowed to issue municipal bonds in compliance with law, but can also borrow through a joint powers agency (JPA). In this case, the JPA serves as a conduit. Conduit financing is preferred by local agencies in certain circumstances because it is more convenient or fixed issuance costs can be split between several conduit borrowers …