Voluntary Disclosure Incentives: Evidence from the Municipal Bond Market

33 Pages Posted: 3 Nov 2013 Last revised: 17 Nov 2016

See all articles by Christine Cuny

Christine Cuny

New York University (NYU) - Leonard N. Stern School of Business

Date Written: April 29, 2016

Abstract

I investigate the trade-off between capital market incentives, reputational concerns, and administrative costs in the public disclosure decisions of municipal bond issuers. After Ambac's bankruptcy, issuers of insured debt increase disclosure relative to issuers of uninsured debt. After local per capita income declines or expenditures increase, issuers, particularly those with strong electoral incentives and weak voter oversight, reduce disclosure. After the implementation of an online filing repository, issuers with few dissemination channels increase disclosure relative to other issuers. Overall, my findings support a positive relationship between voluntary disclosure, risk, and low-cost dissemination, to the extent reputational capital is not threatened.

Keywords: Voluntary disclosure, Risk, Political economy, Information transmission, Municipal debt

JEL Classification: D72, D81, D83, H74

Suggested Citation

Cuny, Christine, Voluntary Disclosure Incentives: Evidence from the Municipal Bond Market (April 29, 2016). Journal of Accounting & Economics (JAE), 62 (2016), pp. 87-102.. Available at SSRN: https://ssrn.com/abstract=2346847 or http://dx.doi.org/10.2139/ssrn.2346847

Christine Cuny (Contact Author)

New York University (NYU) - Leonard N. Stern School of Business ( email )

44 West 4th Street
Ste. 10-91
New York, NY NY 10012
United States
212-998-0423 (Phone)

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