Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/246975 
Year of Publication: 
2013
Series/Report no.: 
EHES Working Papers in Economic History No. 44
Publisher: 
European Historical Economics Society (EHES), s.l.
Abstract: 
This paper does challenge the "regulatory license" view that reliance by regulators on the output of rating agencies in the 1930s "caused" the agencies to become a central part of the fabric of the US financial system. We argue that long before the 1930s, courts began using ratings as financial community produced norms of prudence. This created "a legal license" problem, very analogous to the "regulatory license" problem and gave rise to conflicts of interest not unlike those that have been discussed in the context of the subprime crisis. Rating agencies may have had a responsibility in the Great Depression of the 1930s.
Document Type: 
Working Paper

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