Research On Information Disclosure Of Local Government Special Bonds From The Perspective Of Information Asymmetry

With the implementation of the new "Budget Law" and other laws and regulations in2014,the rectification of local government financing behaviors of "opening the front door" and "blocking the back door" has started,and issuing local government bonds has become the only legal financing way for local governments.Among them,the local government special bonds has a certain source of income from corresponding projects,especially the revenue bonds meets the principle of self balance between revenue and financing,which plays an important role in the counter-cyclical adjustments of making up for short board,stabilizing investment,and promoting development.However,there is a serious problem of information asymmetry in the management and issuance process of local government special bonds.In the management of local government special bonds,the central government is in the disadvantage position of information,which makes the local governments to make moral hazard behavior for the purpose of maximizing its own interests.In the market of local government special bonds,the investors are in the inferior position of information.Due to the lack of information,investors can not accurately identify the credit quality and default risk of local government special bonds,resulting in the obvious distortion of pricing,and even leading to the phenomenon of "bad money driving out good money",which hinders the market-oriented development of local government special bonds.Among them,the information asymmetry between the central government and the local governments transmits and aggravates the information asymmetry of the market of local government special bonds.Therefore,alleviating the information asymmetry between the local governments and investors is the core problem to promote the market-oriented development of the local government special bonds,and information disclosure is critical to alleviate the information asymmetry of the market of local government special bonds.However,the current relevant information disclosure policies and practices have not formed substantial constraints on the information disclosure behavior of local governments,which can not effectively alleviate the information asymmetry of the market of local government special bonds.Throughout the relevant research,foreign theoretical research on the information asymmetry of municipal bonds and empirical research on the impact of information disclosure on municipal bonds have been quite mature,while domestic research on the information asymmetry of local government bonds is less,and the research on the measures to alleviate the information asymmetry of the market of local government special bonds from the perspective of information disclosure is almost blank.Overall,the theoretical research has not kept pace with the development of local government special bonds.Based on the above background and research status,this paper uses the classical theories such as fiscal decentralization theory,principal-agent theory and information asymmetry theory to analyze the information asymmetry problems existing in the market of local government special bonds,and attempts to demonstrate the effectiveness of information disclosure in alleviating information asymmetry by examining the impact of information disclosure on the interest rate and scale of local government special bonds,and puts forward effective measures to alleviate the information asymmetry of the market of local government special bonds according to the practical experience of foreign municipal bonds.This paper is mainly divided into four parts,and the specific research content and main research conclusions are as follows:The first part is literature review and theoretical basis.Firstly,on the basis of combing and summarizing the relevant literature,this paper puts forward the research perspective and explores effective measures to alleviate the information asymmetry of the market of local government special bonds.Secondly,by elaborating the core ideas of fiscal decentralization theory,principal-agent theory,information asymmetry theory,signal transmission theory and other related theories,and extending to the field of local government special bonds,this paper provides theoretical guidance for the research.The second part is the analysis on the mechanism of information asymmetry of local government special bonds and the current situation of information disclosure,revealing the necessity and urgency of strengthening information disclosure.The analysis on the mechanism of information asymmetry of local government special bonds is carried out gradually from three aspects: firstly,by summarizing the issuing process,the dynamic adjustment of management system and the general situation of local government special bonds,the institutional background of the research on the information asymmetry of local government special bonds is established;Secondly,based on the principal-agent theory and information asymmetry theory,this paper analyzes the information asymmetry problem and the resulting moral hazard behavior and adverse selection results from two dimensions,and reveal the internal relationship.Finally,through the analysis of the formation mechanism of information asymmetry in the market of local government special bonds,it is found that the establishment of a chain based on information disclosure and relying on information intermediary for information transmission is an important means to alleviate the information asymmetry,emphasizing the importance of strengthening information disclosure.Based on the above conclusion,this article analyzes the information disclosure of local government special bonds in detail.It is found that although the policy system of information disclosure of local government special bonds has been basically established,the information disclosure of local government special bonds is not perfect and timely due to the imperfect legal system,imperfect market mechanism and blocked information transmission chain,so it is necessary to complete the information disclosure system and improve the level of information disclosure.The third part empirically examines the effectiveness of information disclosure to alleviate the information asymmetry of the market of local government special bonds.This paper arranges two chapters to examine the impact of information disclosure on local government special bonds from dimensions of quality and quantity,so as to demonstrate the effectiveness of information disclosure policy in alleviating the information asymmetry.Firstly,taking the revenue bonds policy piloted in June 2017 as a quasi natural experiment,this paper uses the propensity score matching method(PSM)to investigate the impact of information accuracy on the interest rate of local government special bonds.The results show that although the increased information accuracy improves the interest rate of local government special bonds,the positive effect decreases with the improvement of information disclosure.Therefore,by strengthening the management of information accuracy and increasing the intensity of information disclosure,the information asymmetry of local government special bonds can be alleviated on the premise of ensuring the balance of interests between market entities and local governments.Secondly,based on the panel data of 30 provinces from 2015 to 2019,the fixed effect model is used to examine the impact of information transparency on the scale of local government special bonds.The results show that information transparency has a significant inhibitory effect on the scale of local government special bonds,which means that the problem of information asymmetry in the market of local government special bonds has been alleviated to a certain extent with the improvement of information transparency,so that investors and other subjects can effectively supervise and restrict the debt financing behavior of local governments.The fourth part is the experience and policy suggestions.Firstly,this paper sorts out the practical experience of information disclosure of municipal bonds in the United States,Japan,Australia and Germany,finding that it not only establishes a sound system in the aspects of laws and regulations,platform construction and supervision mode of information disclosure,but also pays attention to the construction of information intermediaries.Based on the practical experience of the United States,this paper constructs a information disclosure system of the market of local government special bonds,and puts forward suggestions to strengthen the information disclosure from the perspective of self authentication mechanism and signal transmission mechanism,so as to alleviate the information asymmetry.The main innovations of this paper are as follows:1.The research perspective is innovative.At present,few scholars in China systematically study the information asymmetry of local government special bonds,and there are only a handful of studies on measures to promote the marketization of local government special bonds from the perspective of information disclosure.2.Expanding the theoretical research of local government special bonds.Based on the principal-agent theory,information asymmetry theory and other related theories,this paper analyzes the information asymmetry of local government special bonds and its consequences in detail,and forms a systematic study on the information asymmetry of local government special bonds,which lays a theoretical foundation for strengthening information disclosure to govern information asymmetry in the market of local government special bonds.3.Expanding the empirical research in the field of local government special bonds.By empirically studying the impact of information accuracy and information transparency on the interest rate and scale of local government special bonds respectively,this article strongly demonstrates the important role of information disclosure in promoting the market-oriented development of local government special bonds by alleviating information asymmetry,which expands the empirical research in the field of local government special bonds.4.Putting forward suggestions to alleviate the information asymmetry in the market of local government special bonds systematically.Based on the theory of signal transmission,this paper proposes suggestions to alleviate the information asymmetry of local government special bonds from the perspective of self authentication mechanism and signal transmission mechanism of information intermediaries.It not only emphasizes the importance of information disclosure by local governments,but also puts forward to build a smooth information transmission chain by strengthening the construction of information intermediaries to effectively alleviate the information asymmetry.