Empirical Study Of Influential Factors To Risk Premium Of City Investment Bond Illustrated By The Case Of Jiangsu

City investment bonds are unique to China and made a great contribution to the development of infrastructure and urbanization.But huge issuance of bonds in many years bought heavy burden to local governments,which became a nonnegligible risk.The central government started the project of local debt disposal and risk resolution in the year of 2004,and local governments are prohibited to provide guaranty for city investment bond in the future.City investment bonds issued before the end of 2014 are treated with classification.The use of proceeds is a key influencing factor in the disposal of city investment bonds,city investment bonds which raised money for public welfare undertaking are more likely to be disposed by advanced redemption or substitution and have more possibility to get support or salvation when risk event happens.Thus,the use of proceeds became an important influential factor to the risk of city investment bonds issued before the end of 2014,and it should be reflected in the risk premium.First this paper recalls the existing research results and the history of city investment bonds.Then takes city investment bonds which were issued by financing platform of prefecture-level cities in Jiangsu province before the end of 2014 as sample,to make qualitative and quantitative study about influential factors of city investment bonds' risk premium with the consideration of debt disposal.Then make suggestions about how local governments raise money for the development of infrastructure and urbanization.