The impact of late budgets on state government borrowing costs
Publikation: Bidrag til tidsskrift › Tidsskriftartikel › Forskning › fagfællebedømt
We analyze how a key component of fiscal governance, the ability of governments to pass a budget on time, affects government bond yield spreads. Based on a sample of 36 US states from 1988 to 1997, and using an original data set on budget enactment dates, we estimate that a 30. day budget delay has a cumulative impact that is equivalent to a one-time increase in the yield spread of around 10 basis points. States with sufficient liquidity incur no costs from late budgets, while unified governments face large penalties from not finishing a budget on time.
Originalsprog | Engelsk |
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Tidsskrift | Journal of Public Economics |
Vol/bind | 109 |
Sider (fra-til) | 27-35 |
Antal sider | 9 |
ISSN | 0047-2727 |
DOI | |
Status | Udgivet - 1 jan. 2014 |
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ID: 94378154