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Statistical analysis of municipal bond ratings under spatial correlation

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Sarmiento, Camilo
Abstract (Spanish)
Este estudio utiliza un modelo logit espacial para evaluar el efecto estadístico de las condiciones de las comunidades en las calificaciones de los bonos municipales. Se encuentra que los ingresos privados (no agrícolas) en la comunidad explican positivamente las calificaciones de los bonos con significancia estadística, mientras que los ingresos provenientes de transferencias personales afectan negativamente las calificaciones. La propia fuente de ingresos de los gobiernos locales (impuestos locales) aumenta las calificaciones y los ingresos intergubernamentales (transferencias a los gobiernos locales) impactan negativamente las calificaciones. La deuda pendiente no logra explicar significativamente las calificaciones. La composición de la economía local (por ejemplo, el sector de servicios) pesa mucho en una calificación, y la proximidad del gobierno local a áreas con altas calificaciones de bonos municipales aumenta las calificaciones.
Abstract (English)
This study uses a spatial logit model to evaluate the statistical effect of conditions of communities on municipal bond ratings. It finds that private (non-farm) earnings in the community positively explain bond ratings with statistical significance, while earnings from personal transfers negatively affect ratings. Own source of revenues of local governments (local taxes) increase ratings and inter-governmental revenues (transfers to local governments) negatively impact ratings. Outstanding debt fails to significantly explain ratings. The composition of the local economy (e.g., the service sector) weights heavily in a rating, and proximity of the local government to areas with high municipal bond ratings increases ratings.
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6 páginas
URI: https://repositorio.escuelaing.edu.co/handle/001/2797
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AG - Centro de Estudios Económicos
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Sarmiento C. and Wilson, W. (2006) Spatially correlated exit strategies in the baking industry, Applied Economics, forthcoming.