The Determinants of the Structure of Rainy Day Funds

Rodríguez-Tejedo, Isabel

doi:10.1111/j.1540-6210.2011.02523.x

Cited by 25 publications

(16 citation statements)

References 37 publications

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“…A stabilization fund formalized and regulated by legislation is transparent because any formal appropriation to the fund will likely be on a public agenda. Stabilization funds are typically viewed differently than other components of fund balance, which is why their “structure, in terms of the rules that control the deposit and withdrawal of funds to and from the fund, has repeatedly been shown to have important consequences for their effectiveness” (Rodríguez‐Tejedo , 376). Transparency forces these funds to compete with other budget priorities, thus pitting the preferences of professional managers and other seasoned professionals against the preferences of at least some members of the electorate.…”

Section: Financial Reserves and Stabilization Fundsmentioning

confidence: 99%

The Politics of Local Government Stabilization Funds

Snow

Gianakis

Haughton

2014

Public Administration Review

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The adoption, maintenance, and prudent use of budgetary stabilization funds are fundamental financial management precepts, yet the variables that influence the size of these funds are poorly understood. This article contributes to the stabilization fund literature by examining the extent to which variation in stabilization fund balances across municipalities and over time can be explained by a community's political culture and financial management capacity. The balanced panel research design includes archival data for 239 Massachusetts municipalities for each of 18 fiscal years. Stabilization fund balances are lower in communities with either an anti‐tax or a pro‐spending political culture. Stabilization fund balances are higher in communities that have the financial management capacity to accumulate budget surpluses that can be made available for appropriation to stabilization funds. Communities with the open town meeting form of government also have higher stabilization fund balances.

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Section: Financial Reserves and Stabilization Fundsmentioning

confidence: 99%

The Politics of Local Government Stabilization Funds

Snow

Gianakis

Haughton

2014

Public Administration Review

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“…The New Zealand Earthquake Commission is one model of this approach. Good results have also been obtained with less formal arrangements through the use of contingency funds by state and local governments (Hou and Duncombe, 2008;Rodriquez-Tejedo, 2008) and below-the-line credit financing accounts (Lucas and Phaup, 2008).…”

Section: Government-provided Insurancementioning

confidence: 99%

Budgeting for disasters

Phaup¹,

Kirschner²

2010

OECD Journal on Budgeting

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Some ways of budgeting for disasters have the potential to increase welfare by increasing national savings, reducing exposure to risk and promoting mitigation prior to a loss. Those ways can also contribute to aggregate fiscal stability over the long term. The power of budgeting, however, can be misdirected to increase losses and lead to fiscal instability. This paper describes the potential for gain from alternative budgetary treatments of policies aimed at reducing the effects on consumption of random shocks to income and wealth. It identifies a critical difference between alternatives: budgetary recognition of expected costs of relief and recovery before the loss event. We classify those different methods as ex ante and ex post budgeting. We also consider some budgetary mechanisms that can promote effective recognition and constrain opportunistic behaviour by elected officials. Finally, this paper describes related budgetary practices in some OECD countries. Many have instituted policies consistent with ex ante budgeting, but we have insufficient information to determine their effectiveness.

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“…For classifications of RDF structures, we relied on Wagner (), Wagner and Elder (), Wagner and Sobel (), and Hou (, ) for 1979–2003. We augmented this classification for the remaining years in 2003–2010 using Rodriguez‐Tejedo (). For the actual data of dollar sizes in RDFs, we relied upon the state CAFRs and Fiscal Survey of the States by NASBO.…”

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confidence: 99%

Economic Crises, Economic Structure, and State Credit Quality Through‐the‐Cycle

Moldogaziev¹,

Guzman²

2015

Public Budgeting & Finance

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The study examines "through-the-cycle" stability of S&P and Moody's state credit ratings to national and state level business cycles during 1977-2010. Additionally, the study evaluates the associations between economic concentration and credit quality in a long panel of state credit ratings. The findings suggest that, with other temporal effects held constant, the ratings of S&P and Moody's are not procyclical and are robust to ups and downs in national or state-specific business cycles. Economic concentration is inversely associated with state credit quality and remains significant for the period of an average business cycle, controlling for national and state economic expansions and contractions.

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The Determinants of the Structure of Rainy Day Funds

Cited by 25 publications

References 37 publications

The Politics of Local Government Stabilization Funds

The Politics of Local Government Stabilization Funds

Budgeting for disasters

Economic Crises, Economic Structure, and State Credit Quality Through‐the‐Cycle

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