Suchergebnisse

Public pension funds have gained greater prominence in recent years. Many are severely under-funded and collectively, state and local pension funds are several hundred billion dollars in the red. This book examines public pension funds from both the technical and policy perspectives. It provides a comprehensive discussion of fund management, detailing important technical materials needed to help readers understand the subject.

This article provides a normative framework for understanding the important link between public pension fund management and government operating budgets. Three aspects of pension fund management are discussed that have a significant impact on the operating budget: pension contribution, investment strategy, and the funding of pension liabilities. Three cases concerning West Virginia, New Jersey, and New York City are discussed to illustrate these three important aspects. The normative framework and the case studies demonstrate two important principles in prudently managing public pension funds: ensuring intergenerational equity and protecting the long‐term health of government budgets.

This article demonstrates that for insured municipal bonds, revelation of underlying ratings can be an effective mechanism for further alleviating the information asymmetry problems found in the municipal bond market. Due to the prevalence of municipal bond insurance, investors are increasingly relying on the underlying ratings of insured bonds in gauging the relative riskiness of these bonds. For a sample of 697 municipal bonds issued in 1998, the results indicate that Standard & Poor's underlying ratings are able to reduce borrowing cost by four basis points, due to the additional information provided through these ratings.