Reconsidering the Determinants of Public Authority Use

This article investigates the causes of differences among states in the use of independent public authorities. Contrary to findings in previous work, I find that the evidence does not support the view that authorities are “borrowing machines”, created to provide better access to capital markets. Rather, the factors associated with use of authorities seem distinct from those associated with general obligation borrowing, which suggests that purely fiscal motivations are not primary determinants of the use of authorities.