 MSRB Supports Academic Research
A chat with MSRB Visiting Scholar Christine Cuny, Assistant Professor of Accounting, New York University Stern School of Business.
MSRB staff sat down with the MSRB’s first Visiting Scholar to discuss how academics are using MSRB data in their research on the municipal securities market. The MSRB’s Visiting Scholar Program provides interested academics with an opportunity to conduct research with support from MSRB staff in order to generate insights that may enhance the understanding of market efficiency and transparency.
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Christine Cuny is Assistant Professor of Accounting at New York University’s Stern School of Business. Her research focuses on disclosure and financial reporting, local governments, municipal finance, information asymmetry and imperfect markets, and transparency and market microstructure. Cuny has published her research in key publications and presented it at leading academic institutions in the United States and abroad. She has a Ph.D. in Accounting and an MBA from the University of Chicago Booth School of Business, and an MS in Accountancy and a BS in Analytical Finance from Wake Forest University. |
Q: How did you get interested in public finance research?
The public finance market caught my attention after the financial crisis. Reports about the financial health of corporations were prevalent, but those about local governments were sparse.
Q: Why did you want to apply to be the MSRB’s first visiting scholar?
I am interested in how academic research can contribute to the discussion surrounding market and regulatory issues. I was also interested to learn how the MSRB incorporates information from market participants into the regulatory process. I am most interested in the disclosure aspects of the municipal securities market.
Q: What questions are you looking to answer with MSRB data? What are your preliminary findings?
I looked at the effect of the mark-up disclosure rule on trading patterns and trading costs. Using trade data with anonymized dealer identifiers, I studied whether the disclosure rule reduced mark-ups or the prevalence of trades with a same-day offset. My findings corroborate those of the MSRB’s own research. Although trading costs and the prevalence of trades with same-day offsets declined, this occurred across all but the largest trades. Thus, it is not clear that the decline can be attributed to the mark-up disclosure rule.
Q: Besides our Visiting Scholar program and providing data to universities, what else should the MSRB be doing to facilitate academic research into the municipal securities market?
Making the trade data available has certainly helped academic researchers. Although financial disclosures are available in PDF format from EMMA and the Census collects some information, it is burdensome to aggregate fundamental information in large-scale at the local government level. I think if the content of the financial disclosures were easily accessible in machine readable format, it would facilitate more in-depth large-scale research from academics.
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