The economics of rating watchlists: evidence from rating changes
- Generally, information provision and certification have been identified as the major economic functions of rating agencies. This paper analyzes whether the “watchlist" (rating review) instrument has extended the agencies' role towards a monitoring position, as proposed by Boot, Milbourn, and Schmeits (2006). Using a data set of Moody's rating history between 1982 and 2004, we find that the overall information content of rating action has indeed increased since the introduction of the watchlist procedure. Our findings suggest that rating reviews help to establish implicit monitoring contracts between agencies and borrowers and as such enable a finer partition of rating information, thereby contributing to a higher information quality.
| Verfasserangaben: | Christian HirschGND, Christina E. BannierORCiDGND |
|---|---|
| URN: | urn:nbn:de:hebis:30-52376 |
| Titel des übergeordneten Werkes (Deutsch): | Center for Financial Studies (Frankfurt am Main): CFS working paper series ; No. 2008,02 |
| Schriftenreihe (Bandnummer): | CFS working paper series (2008, 02) |
| Dokumentart: | Arbeitspapier |
| Sprache: | Englisch |
| Jahr der Fertigstellung: | 2008 |
| Jahr der Erstveröffentlichung: | 2008 |
| Veröffentlichende Institution: | Universitätsbibliothek Johann Christian Senckenberg |
| Datum der Freischaltung: | 29.01.2008 |
| Freies Schlagwort / Tag: | Credit Rating Agencies; Event Study; Market Reactions; Watchlist |
| GND-Schlagwort: | Rating; Checkliste |
| Ausgabe / Heft: | December 12, 2007 |
| Seitenzahl: | 46 |
| HeBIS-PPN: | 195114515 |
| Institute: | Wirtschaftswissenschaften / Wirtschaftswissenschaften |
| Wissenschaftliche Zentren und koordinierte Programme / Center for Financial Studies (CFS) | |
| DDC-Klassifikation: | 3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft |
| Lizenz (Deutsch): |  Deutsches Urheberrecht |
