We study the link between the choice of rule-based financing instruments and political competition using the municipal bond market. Cities, counties, and states issue municipal bonds to raise money for public projects. These securities comprise a substantial fraction of the overall American...

I study the link between the choice of rule-based contracts and political competition through the municipal bond market. I provide evidence that when the probability of losing office is high, mayors are more likely to issue revenue bonds over general obligation bonds and to choose competitive...

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...

Municipal accounting information is widely believed to be useful to creditors in assessing bond default risk (e.g., Wallace 1985; Wilson and Howard 1985). Users of accounting information perceive that Big 8 auditors provide higher quality audits both for corporations (Shockley and Holt 1983; McKinley et...

This is the first paper that decomposes the municipal bond spread into its default and liquidity risk components in Japan's market. The tax effect is identified using institutional information about Japan, which enables us to simplify the model drastically. To overcome the availability of the...

We estimate the option value of municipal liquidity by studying bond market activity and public sector hiring decisions when government budgets are severely distressed. Using a regression discontinuity (RD) design, we exploit lending eligibility population cutoffs introduced by the federal...