The Real Interest Rate Yield on Long Term Municipals: What is the Role of Budget Deficits?

Richard Cebula () and Shelley Merrick

MPRA Paper from University Library of Munich, Germany

Abstract: This study empirically finds, using ECM, that the primary federal budget deficit shares a bi-directional relationship with the ex ante real interest rate yield on long term municipal bonds. That is, the primary budget deficit acts to raise the real municipal bond yield whereas that yield also acts to raise the primary deficit.

Keywords: real interest rate yield on municipal bonds; federal budget deficit; crowding out (search for similar items in EconPapers)
JEL-codes: E43 H61 H74 (search for similar items in EconPapers)
Date: 2002-09-12
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Published in The International Business & Economics Research Conference Program & Proceedings 1.13(2003): pp. 1-10

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:58477

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