South Asian Journal of Management

Open Access Open Access  Restricted Access Subscription Access
Open Access Open Access Open Access  Restricted Access Restricted Access Subscription Access

Municipal Bonds as an Investment Option among Indian Investors


Affiliations
1 Institute of Public Enterprise (IPE), Survey #1266, Shamirpet, Medchal-Malkajgiri Dist, Hyderabad-500 101, India
2 Institute of Public Enterprise (IPE), Survey #126, Shamirpet, Medchal-Malkajgiri Dist, Hyderabad-500 101, India
     

   Subscribe/Renew Journal


Rapid urbanization coupled with increasing population throws up enormous challenges to local governments in India. One of the key concerns for the local governments is providing basic infrastructure facilities and quality services as well as improving living standards for the citizens. This situation requires the Urban Local Bodies (ULBs) to find innovative ideas for solving the infrastructure and service delivery problems and for creating a larger pool of funds for strengthening the ULBs. The current paper deals with the municipal bond as an innovative option of municipal finance. This study explores the satisfactoriness of an important measure taken by the local government i.e. introduction of municipal bonds to create a local funding source to improve the infrastructure facilities at the grass ischolar_main levels and analyses weather this initiative has been accepted well by the citizens/general public at large. Partial Least Square Structural Equation Model (PLS-SEM) was used to establish the reliability and validity of the scales and to test the hypotheses. The results documented investors’ perception to have greater impact in influencing municipal bond investment decision of Indian investors.

Keywords

Local Government, Municipal Bonds, Public Finance, Structural Equation Model (SEM), Urban Local Bodies (ULBs).
User
Subscription Login to verify subscription
Notifications
Font Size

  • Agarwal, R., & Karahanna, E. (2000). Time flies when you’re having fun: Cognitive absorption and beliefs about information technology usage. MIS Quarterly, 24(4), 665-694.

  • Anand, S and Murugaiah, V. (2004). Marketing of Financial Services: Strategic issues, SCMS Journal of Indian Management.

  • Bahl, R. W., & Linn, J. F. (2014). Governing and financing cities in the developing world. Cambridge, MA: Lincoln Institute of Land Policy.

  • Chakrabarti, M. (2014). Municipal Bond Market in India. Indian Journal of Applied Research, 4(3), 83-85.

  • Chin, W. W. (1998). The partial least squares approach to structural equation modeling. Modern Methods for Business Research, 295(2), 295-336.

  • Chin, W. W., Marcolin, B. L., & Newsted, P. R. (2003). A partial least squares latent variable modeling approach for measuring interaction effects: Results from a Monte Carlo simulation study and an electronic-mail emotion/adoption study. Information Systems Research, 14(2), 189-217.

  • Cities, M. A. (2008). Sustainable and inclusive urban solutions (Asian Development Bank Report). Manila, Philippines: Asian Development Bank.

  • Cohen, J. (1992). A power primer. Psychological Bulletin, 112(1), 155-159.

  • Department of Economic and Social Affairs (DESA). (2012). World urbanization prospects, the 2011 Revision. New York, NY: United Nations Secretariat.

  • Desigan, C. G., Selvaraj, K., & Anusuya, L. (2006). Women Investors’ Perception Towards Investment: An Emprical Study. Indian Journal of Marketing.

  • Dirie, I. (2005). Municipal finance: Innovative resourcing for municipal infrastructure and service provision. In A report prepared for commonwealth local government forum in cooperation with ComHabitat.

  • Fornell, C., & Bookstein, F. L. (1982). Two structural equation models: LISREL and PLS applied to consumer exit-voice theory. Journal of Marketing Research, 19(4), 440-452.

  • Fornell, C., & Larcker, D. F. (1981). Structural equation models with unobservable variables and measurement error: Algebra and statistics. Journal of Marketing Research, 18(3), 382-388.

  • Garg, S. C. (2007). Overview of urban infrastructure finance in India. Financing Cities: Fiscal Responsibility and Urban Infrastructure in Brazil, China, India, Poland and South Africa, 108-57.

  • Hair, J. F., Ringle, C. M., & Sarstedt, M. (2011). PLS-SEM: Indeed a silver bullet. Journal of Marketing Theory and Practice, 19(2), 139-152.

  • Hair, J. F., Ringle, C. M., & Sarstedt, M. (2013). Editorial-partial least squares structural equation modeling: Rigorous applications, better results and higher acceptance.

  • Joe Jr, F., Sarstedt, M., Hopkins, L., & Kuppelwieser, V. G. (2014). Partial least squares structural equation modeling (PLS-SEM): An emerging tool in business research. European Business Review, 26(2), 106-121.

  • Kapoor, G., & Pati, P. (2017). Municipal Bond Market in India.

  • Khan, H. R. (2013, July). Financing strategies for urban infrastructure: Trends and challenges. In inaugural address delivered at The Conference on Financing Strategies for Urban Infrastructure Organized by CAFRAL, Mumbai.

  • Mase, B. (2006). Investor awareness and the long-term impact of FTSE 100 index redefinitions. Applied Financial Economics, 16(15), 1113-1118.

  • Mathur, O. P. (2006). Urban finance. India Infrastructure Report, 82-105.

  • Mehta, M., & Satyanarayana, V. (1999). Ahmedabad Municipal Bond Issue: India’s First without a Guarantee (No. 17). Project Note.

  • Ministry of Human Resource Development (MHRD). (2018). The Constitution (Seventy-fourth Amendment) Act 1992. New Delhi, India: Author.

  • Mohanty, P. K. (2019). Planning and economics of cities: Shaping India’s form and future. New Delhi, India: Sage Publications India.

  • Nallathiga, R. (2010). Redevelopment of industrial land in urban areas: opportunities and constraints. A case study of textile mill land redevelopment in Mumbai. Theoretical and Empirical Researches in Urban Management, 5(14), 35-46.

  • Nallathiga, R. (2015). Municipal bonds as a source of finance for urban infrastructure development in India.

  • National Institute of Public Finance and Policy (NIPFP) (2011). Municipal finance matters: India municipal finance report. New Delhi, India: Author.

  • Pethe, A., & Lalvani, M. (2006). Towards economic empowerment of urban local bodies in Maharashtra. Economic and Political Weekly, 635-641.

  • Rao, N. R. (1986), “Municipal finance in India: Theory and Practice”, InterIndia Publications .

  • Sadhu, A., & Bharatwaj, S. R. (2003). Developing municipal bond markets in India. India infrastructure report, 212-218.

  • Sankhe, S., Vittal, I., Dobbs, R., Mohan, A., Gulati, A., Ablett, J., ... & Sethy, G. (2010). India’s urban awakening: Building inclusive cities, sustaining economic growth. McKinsey Global Institute (MGI).

  • Sheikh, S., & Asher, M. G. (2012). A case for developing the municipal bond market in India. ASCI journal of Management, 42(1), 1-19.

  • Sing, B. K. and Jha A. K. (2009). An Emprical Study on Awareness and Acceptability of Mutual Fund. In Proceedings of Regional Student Conference, ICWAI, 49-55.

  • Singh, C., & Singh, C. (2015). Financing of Urban Local Bodies in India.

  • United Nations. (2014). World urbanization prospects: The 2014 revision. New York, NY: Department of Economic and Social Affairs (DESA).

  • United Nations Habitat. (2016). World Cities Report 2016: Urbanization and development-emerging futures. New York, NY: Author.

  • United States Agency for International Development (USAID). (2005). Fragile states strategy. Washington, DC: Author.

  • United States Securities and Exchange Commission. (2012). Report on the municipal securities market. Washington, DC: Author.


Abstract Views: 361

PDF Views: 0




  • Municipal Bonds as an Investment Option among Indian Investors

Abstract Views: 361  |  PDF Views: 0

Authors

Ram Kumar Mishra
Institute of Public Enterprise (IPE), Survey #1266, Shamirpet, Medchal-Malkajgiri Dist, Hyderabad-500 101, India
Mousumi Singha Mahapatra
Institute of Public Enterprise (IPE), Survey #1266, Shamirpet, Medchal-Malkajgiri Dist, Hyderabad-500 101, India
P. Geeta
Institute of Public Enterprise (IPE), Survey #126, Shamirpet, Medchal-Malkajgiri Dist, Hyderabad-500 101, India

Abstract


Rapid urbanization coupled with increasing population throws up enormous challenges to local governments in India. One of the key concerns for the local governments is providing basic infrastructure facilities and quality services as well as improving living standards for the citizens. This situation requires the Urban Local Bodies (ULBs) to find innovative ideas for solving the infrastructure and service delivery problems and for creating a larger pool of funds for strengthening the ULBs. The current paper deals with the municipal bond as an innovative option of municipal finance. This study explores the satisfactoriness of an important measure taken by the local government i.e. introduction of municipal bonds to create a local funding source to improve the infrastructure facilities at the grass ischolar_main levels and analyses weather this initiative has been accepted well by the citizens/general public at large. Partial Least Square Structural Equation Model (PLS-SEM) was used to establish the reliability and validity of the scales and to test the hypotheses. The results documented investors’ perception to have greater impact in influencing municipal bond investment decision of Indian investors.

Keywords


Local Government, Municipal Bonds, Public Finance, Structural Equation Model (SEM), Urban Local Bodies (ULBs).

References