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dc.contributor.authorBannier, Christina E.en_US
dc.contributor.authorHirsch, Christianen_US
dc.date.accessioned2009-09-15en_US
dc.date.accessioned2009-09-16T12:08:55Z-
dc.date.available2009-09-16T12:08:55Z-
dc.date.issued2009en_US
dc.identifier.piurn:nbn:de:101:1-2009070304en_US
dc.identifier.urihttp://hdl.handle.net/10419/27929-
dc.description.abstractCredit rating agencies do not only disclose simple ratings but announce watchlists (rating reviews) and outlooks as well. This paper analyzes the economic function underlying the review procedure. Using Moody's rating data between 1982 and 2004, we find that for borrowers of high creditworthiness, rating agencies employ watchlists primarily in order to improve the delivery of information. For low-quality borrowers, in contrast, the review procedure seems to have developed into an implicit contract `a la Boot, Milbourn, and Schmeits (2006), inducing the companies on watch to abstain from risk-augmenting actions. The agencies' economic role hence appears to have been enhanced from a pure information certification towards an active monitoring function.en_US
dc.language.isoengen_US
dc.publisherFrankfurt School of Finance & Management Frankfurt, M.en_US
dc.relation.ispartofseriesWorking paper series // Frankfurt School of Finance & Management 124en_US
dc.subject.jelG14en_US
dc.subject.jelG29en_US
dc.subject.jelG33en_US
dc.subject.ddc330en_US
dc.subject.keywordCredit Rating Agenciesen_US
dc.subject.keywordCredit Ratingen_US
dc.subject.keywordWatchlisten_US
dc.subject.keywordRating Reviewen_US
dc.subject.keywordMarket Reactionen_US
dc.subject.keywordEvent Studyen_US
dc.titleThe economic function of credit rating agencies: what does the watchlist tell us?en_US
dc.typeWorking Paperen_US
dc.identifier.ppn605675929en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
dc.identifier.repecRePEc:zbw:fsfmwp:124-
Appears in Collections:Frankfurt School - Working Paper Series, Frankfurt School of Finance and Management

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