Proceedings of the New York State Economics Association


The Term Structure of State Bond Interest Rates

A.Espinosa, K. Foster and J. Schmitz

vol. 6, October 2013, p. 19-28


This paper uses daily trade data from the EMMA database (Electronic Municipal Market Access) for the period 2004-2012 to examine the behavior of interest rates on state-issued bonds, particularly the influence of local employment shocks on state bond yields and premiums relative to US Treasury rates. This is a topic of important public policy relevance due to the budget woes of many of the US states since prices of fixed-income securities are influenced by changing beliefs about the riskiness of the future cash flows.


suggested citation:

A.Espinosa, K. Foster and J. Schmitz. "The Term Structure of State Bond Interest Rates." Proceedings of the New York State Economics Association. vol. 6, October 2013, p. 19-28

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