Do State Bond Banks Have Cost Advantages for Municipal Bond Issuance? |
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| Authors: | Mark D Robbins Daehwan Kim |
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| Institution: | Mark D. Robbins is an Assistant Professor of Political Science at the Institute of Public Affairs at the University of Connecticut. His work has appeared in Public Administration Review;, Public Budgeting and Finance, and State and Local Government Review in addition to other books and journals. Daehwan Kim (1970–2002) was a doctoral student in public administration at the University of Georgia's School of Public and International Affairs. He received the Bill Collins award for outstanding doctoral student research paper at the 2002 Southeastern Conference on Public Administration (SECOPA). He was nearing completion of his dissertation at the time of his death in December 2002. He was working on other projects with Mark Robbins and Bill Simonsen. We will miss him very much. |
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| Abstract: | State bond banks are created to extend management expertise, subsidies, and economies of scale to local government issuers, but bond banks incur issuance and program costs. This research examines whether state bond banks appear to achieve lower than average borrowing costs, once the costs of issuance are controlled for. We find that bond banks are associated with significantly lower borrowing costs for two of the three programs we examine, and determine that these savings are due largely to reductions in costs of issuance. |
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