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Economic freedom and the mispricing of single-state municipal bond closed-end funds

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  • Samuel Jones
  • Michael Stroup

Abstract

The Economic Freedom of North America Index (EFI) is a measure of the state-level institutional characteristics that promote economic activity. We use this index as a proxy for the degree of local market segmentation and test the hypothesis that single-state, municipal bond closed-end fund mispricing can be partially explained by a state’s EFI value. Using panel data analysis we find that EFI is significant in explaining observed variability in fund mispricing. Copyright Springer Science+Business Media, LLC 2013

Suggested Citation

  • Samuel Jones & Michael Stroup, 2013. "Economic freedom and the mispricing of single-state municipal bond closed-end funds," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 37(2), pages 173-187, April.
    • Handle: RePEc:spr:jecfin:v:37:y:2013:i:2:p:173-187
    DOI: 10.1007/s12197-011-9174-y
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    More about this item

    Keywords

    Single-State Municipal Closed-End Fund; Economic Freedom Index; G23;
    All these keywords.

    JEL classification:

    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors

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