Research On Municipal Bond Market Development

Municipal bond is a form of bond that urban governments absorb fund from society according to credit principle and meet city public expenditure. It is an important component of government bond system. Municipal bond occupies very important status at the developed countries bond market as one of common financing tools. It's successful application will help to speed up urban construction and create good environment for local economic liftoff.Our country's rapid development of economy makes local government have heavy demand on municipal construction fund. But issuing municipal bond in the form of company's bond still has a lot of problems that can't be avoided. With our country carrying out deep reform on financial and fiscal system, it is necessary and feasible to introduce financial instruments, such as municipal bond, to develop and foster the independent municipal bond market.This paper analyzes municipal bond classification, characteristic, function and U.S.A. current situation of municipal bond, discusses necessity and feasibility that our country establishes system of municipal bond, then puts forward the basic thought of establishing China municipal bond system.