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Maureen H. Berry, Editor UNIVERSITY OF ILLINOIS
DOCTORAL RESEARCH
The main emphasis in this edition of doctoral research review is on finance: both public and private and from the viewpoints of both investors and investees. We commence with Haiti's survey of risks and returns to corporate bondholders during the period 1950-1974. Traditionally, investors have considered well-rated corporate bonds as a safe and lucrative investment and, with respect to safety at lest, Haiti's research confirmed this. It was another story, how-ever, with respect to returns. On the average, investment grade bonds returned only 2.71 percent over the twenty-five year period reviewed—which could be a significant finding for those investors attracted to corporate bonds because of the unprecedentedly high yields in recent years. We shift the focus from the lender to the borrower and from the domestic to the overseas markets and look at the Brazilian experience with private external borrowing. Moura's research examined portfolio capital behavior in a large developing country, concentrating on private sector active borrowing in external financial markets, and found strong interrelationships between the stock of foreign debt and the level of domestic income.
From the private sector, we move on to examine borrowing at the macro level. Feldstein's study of New York's municipal debt structure during the period 1962-72 highlighted the key role played by the mayor in deciding how to finance the operating and capital needs of the city. Using a variety of data sources, including eight case studies, Feldstein showed that the traditional use of property taxes and long-term financing for operating and capital needs were, time after time, rejected in favor of the politically expedient issue of short-term debt. Municipal debt is, of course, an integral part of public budgeting. Once again we travel overseas: this time to review Shahroodi's study of the Iranian budgetary system during the years 1960-1976 when it progressed from a typical line-item structure towards a more program budget orientation. However, the system still had a long way to go towards reaching program budget status and Shahroodi's recommendations for improvement included in-creased involvement by the people and by the parliament.
