Aging and public financing costs: Evidence from US municipal bond markets q

• 成果类型: Article
• 署名作者: Butler, Alexander W.; Yi, Hanyi
• 署名单位: Rice University; Boston College
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2022.104665
• 发表日期: 2022
• 关键词: Local public finance; municipal bonds; demographics; Aging

摘要

We examine the impact of population aging on municipal access to credit. A one standard deviation increase in a state's population age leads to a 23 basis point increase in municipal bond issue spread. Three mechanisms drive this effect: income tax revenue, healthcare spending, and pension liabilities. Constitutional pension protections and securities with lower credit quality or longer maturity exacerbate the effect. To control for endogenous migration and mortality patterns, we exploit variation from historical state fertility trends. Our findings highlight the challenges municipalities face to cope with systemic demographic transition.