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Much Ado about Nothing? The Size and Credit Quality Implications of Municipal Other Postemployment Benefit Liabilities
Author(s) -
MARLOWE JUSTIN
Publication year - 2007
Publication title -
public budgeting and finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.694
H-Index - 30
eISSN - 1540-5850
pISSN - 0275-1100
DOI - 10.1111/j.1540-5850.2007.00877.x
Subject(s) - current liability , issuer , liberian dollar , liability , business , quality (philosophy) , scope (computer science) , per capita , contingent liability , credit rating , monetary economics , economics , actuarial science , finance , market liquidity , debt , population , philosophy , demography , epistemology , sociology , computer science , programming language
This paper presents estimates of the size and scope of other postemployment benefit (OPEB) liabilities among municipal governments. The findings indicate these liabilities vary substantially, ranging from less than a dollar per capita to more than $2,000 per capita. Those liabilities were then incorporated into separate models of credit ratings and borrowing costs. Results suggest OPEB liabilities do not directly affect credit quality, but the interaction between an issuer's fiscal capacity to address its liability does have a notable effect.