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นวัตกรรมการพัฒนารายได้ 1
ขององค์กรปกครองส่วนท้องถิ่น

Example

The USA : Generally, local bonds will be guaranteed by the state
government and come with tax-exempt interests. The main aim of bonds is for the

local infrastructure development and to stimulate local economic development.

Japan : Local bonds are a debt incurred by local governments. The benefits
of local bonds are to help develop the local economy and the public services.

There are 2 kinds of loans. The two systems have different advantages and

disadvantages. Thus, choosing which of the loans is to consider the availability and suitability
as well as the advantages and disadvantages. The two loan systems have the following
advantages and disadvantages.

= Advantages of loans through financial institutions include:

1) Reducing information asymmetry such as Delegated Monitoring Services It is
required to analyze and evaluate financial information to local government to

determine the appropriate credit limits and conditions. This action will reduce
the imbalance data of the analysis.

2) Reducing the cost of the deal such as transaction, monitoring, and contract
enforcing costs and reducing the financial risks

3) In terms of the borrower, this method is quite flexible because local borrowers

can negotiate the terms of the loan and the waiver of repayment (if necessary)
with the financial institution directly.

= Disadvantages of loans through financial institutions include:

1) The problem is Rent-seeking behavior that is a bank or financial institution may
exercise control over the investment decisions or operations of the district due
to a loan.

2) The fixed interest or fees in order to increase the profitability of financial
institutions which adversely affect the overall economic development.

= Advantages of bonds are:

1) Improving channels of access to long-term funding to local government