State Fiscal Institutions and the U.S. Municipal Bond Market

What Explains the Surge in Euro Area Sovereign Spreads During the Financial Crisis of 2007–2009?

“…For the U.S., a seminal paper by Goldstein and Woglom (1992) finds evidence that the debt level of U.S. states has a positive impact on their bond yield relative to that of other states. Further evidence in this direction was provided by Bayoumi et al (1995) and Poterba and Rueben (1999). Regarding the fiscal deficit, Laubach (2009) Beber et al (2009) find that liquidity risk is a highly relevant (even the most important) factor in explaining sovereign bond spreads after the introduction of the euro and in times of heightened uncertainty respectively.…”

Determinants of sub-sovereign bond yield spreads – The role of fiscal fundamentals and federal bailout expectations

“…Bayoumi et al (1995), Poterba andRueben (1999, 2001) as well as Johnson and Kriz (2005) show that bond spreads of US state governments significantly reflect differences in fiscal fundamentals and find that spreads are lower in states with stricter, self-imposed fiscal rules. Feld et al (2013) provide similar evidence for Swiss cantons.…”

Fiscal variables and bond spreads – evidence from Eastern European countries and Turkey

“…For the U.S., Goldstein and Woglom (1992) in a seminal paper report evidence that the debt level of U.S. states has a positive impact on their bond yield relative to that of other states. Further evidence in this direction was provided by Bayoumi et al (1995) and Poterba and Rueben (1999).…”