Pension obligation bonds and government spending

Thad D. Calabrese, Todd L. Ely

Research output: Contribution to journalArticle

Abstract

We examine the use of pension obligation bonds (POBs) as a financing strategy to address the effects of unfunded pension liabilities on government operating budgets. POBs are publicly marketed as money-saving mechanisms that reduce pension system payments while allowing for increased spending on other government priorities. We review general POB usage and examine whether POBs altered school district spending patterns in Oregon and Indiana. Our results indicate that districts issuing POBs have not increased educational spending relative to other districts. Because POBs cost money to issue and manage, decision makers are encouraged to consider annual budgetary effects prior to issuance.

Original languageEnglish (US)
Pages (from-to)43-65
Number of pages23
JournalPublic Budgeting and Finance
Volume33
Issue number4
DOIs
StatePublished - Dec 2013

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obligation
district
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ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics
  • Public Administration

Cite this

Pension obligation bonds and government spending. / Calabrese, Thad D.; Ely, Todd L.

In: Public Budgeting and Finance, Vol. 33, No. 4, 12.2013, p. 43-65.

Research output: Contribution to journalArticle

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