Do personal connections improve sovereign credit ratings?

Patrycja Klusak; John Thornton; Yurtsev Uymaz

doi:10.1016/j.frl.2019.05.012

Do personal connections improve sovereign credit ratings?

Patrycja Klusak, John Thornton, Yurtsev Uymaz

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Abstract

In a large sample of sovereign debt issues, we show that a personal connection between senior executives in credit rating agencies and leading politicians in the sovereign results in an improved rating. A test on bond yields suggest that the personal connection reflects a favorable treatment of the issuer.

Original language	English
Article number	101194
Journal	Finance Research Letters
Volume	33
Early online date	20 May 2019
DOIs	https://doi.org/10.1016/j.frl.2019.05.012
Publication status	Published - Mar 2020

Keywords

Information asymmetries
Personal connections
Sovereign credit ratings

Access to Document

10.1016/j.frl.2019.05.012

Accepted_ManuscriptAccepted author manuscript, 835 KBLicence: CC BY-NC-ND

Cite this

@article{640f963cd2564d5fb28808b63e3a1604,

title = "Do personal connections improve sovereign credit ratings?",

abstract = "In a large sample of sovereign debt issues, we show that a personal connection between senior executives in credit rating agencies and leading politicians in the sovereign results in an improved rating. A test on bond yields suggest that the personal connection reflects a favorable treatment of the issuer.",

keywords = "Information asymmetries, Personal connections, Sovereign credit ratings",

author = "Patrycja Klusak and John Thornton and Yurtsev Uymaz",

year = "2020",

month = mar,

doi = "10.1016/j.frl.2019.05.012",

language = "English",

volume = "33",

journal = "Finance Research Letters",