| Summary: | "This book theorizes that information is a critical factor for subnational government (SNG) capital market formation and development. It empirically tests the stated relationship between information resolution institutions and mechanisms of information resolution on SNG borrowing. Based on empirical results, analyses of underlying fundamentals of city credit quality, and the study of contexts of information resolution reforms, the book recommends policy measures for central governments, regional and local governments, and financial sector firms to build capital markets for subnational borrowing. As subnational governments across the globe, especially cities, bear increasing pressures to provide critical capital infrastructure, responsibilities for the provision of local infrastructure resulting from decentralization efforts and population demands, the need for a wider array of internal and external resources, including bond market alternatives, becomes a priority. With information resolution, access to capital market financing becomes a feasible option of regional and local government finance. The evidence reported in this book demonstrates that SNG access to capital market financing depends on credit contractibility, which is the nation's capacity of information resolution. The bases of credit contractibility are transparency of credit information, depth of credit information, dissemination, and regulatory quality. Evidence also shows that the informational content of underlying credit quality is a significant covariate of city-level borrowing and debt composition. Based on empirical findings and focusing on cities, the book argues that SNGs can and should strengthen their agency vis-à-vis the public and financial sector actors, in an environment where global capital is increasingly intertwined with the provision of critical infrastructure finance. Agency is necessary for cities not only to achieve their key governance tasks efficiently, but also effectively and equitably, consistent with the demands of the citizenry"--
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