Municipal Borrowing Costs and the Differential Impact of Accounting Information Across Rating Categories

Research in Government and Nonprofit Accounting (RIGNA) 1986, 2: 261-273

Posted: 27 Aug 2014

See all articles by Earl D. Benson

Earl D. Benson

Western Washington University - Finance and Marketing Department

Barry R. Marks

University of Houston, Clear Lake - School of Business and Public Administration

K. K. Raman

The University of Texas at San Antonio

Date Written: 1986

Abstract

Prior research (Wallace, 1981 Wilson and Howard, 1984) has implicitly asĀ­sumed that the impact of accounting information on municipal borrowing costs is the same across all bond rating groups. This paper provides empirical evidence that the demand for accounting information is a function of default risk and suggests a means for improving the power of bond default risk models to detect accounting effects.

Keywords: Government borrowing costs, differential impact of accounting information, rating categories

JEL Classification: M41, M42, M48

Suggested Citation

Benson, Earl D. and Marks, Barry R. and Raman, K. K., Municipal Borrowing Costs and the Differential Impact of Accounting Information Across Rating Categories (1986). Research in Government and Nonprofit Accounting (RIGNA) 1986, 2: 261-273. Available at SSRN: https://ssrn.com/abstract=2483942

Earl D. Benson

Western Washington University - Finance and Marketing Department ( email )

FMDS Department MS 9077
Bellingham, WA 98225-9077
United States
360-650-3375 (Phone)
360-650-4844 (Fax)

Barry R. Marks

University of Houston, Clear Lake - School of Business and Public Administration ( email )

Houston, TX 77058
United States

K. K. Raman (Contact Author)

The University of Texas at San Antonio ( email )

One UTSA Circle
San Antonio, TX 78249
United States
210-458-8749 (Phone)

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