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This study is a follow up of an earlier investigation concerning the effects of governance practices and investment strategies on public pension fund risk adjusted financial performance. Specifically, the inquiry uses three cross sectional national surveys of state and local government retirement systems to determine how governance practices in terms of system policies, board purview, and board composition impact abnormal returns. Results indicate that governance practices, particularly board purview over investment decisions, continue to have a direct negative impact on risk adjusted financial performance even after controlling for other factors.

This study is a follow up of an earlier investigation concerning the effects of governance practices and investment strategies on public pension fund risk adjusted financial performance. Specifically, the inquiry uses three cross sectional national surveys of state and local government retirement systems to determine how governance practices in terms of system policies, board purview, and board composition impact abnormal returns. Results indicate that governance practices, particularly board purview over investment decisions, continue to have a direct negative impact on risk adjusted financial performance even after controlling for other factors.

In the past two decades, much of the literature in the area of government financial management has been devoted to studying the causes of fiscal stress. Most studies emphasized the role of such factors as economic cycles, business relocation and factors beyond the control of policy makers as major causes of fiscal stress. This study extends the scope of the research in this area to investigate whether state and local fiscal structures contribute to fiscal stress. Using a pooled cross-sectional time-series approach with the state-local data ranging from 1982 to 1997, the result shows that: there is more significant difference in the composition of tax structures than that of total revenue; high aggregate spending is associated with high fiscal stress; state and local governments over-commit on the social welfare category; local revenue diversification is associated with low fiscal stress; and fiscal decentralization or high spending responsibility assumed by local governments is associated with low fiscal stress. The findings suggest that local revenue diversification and fiscal decentralization can be used as measures to reduce fiscal stress.

In this paper, we examine the cash management practices in the State of Louisiana and contrasted those practices with the rate of return on investment income due to cash management practices. Essentially, we framed various model hypotheses from the literature, which tells us that if those practices exist then we should see an increased rate of return due to cash management. In general, our research supported the literature but there were some interesting exceptions that merit attention.