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Credit Ratings: Strategic Issuer Disclosure and Optimal Screening
dc.contributor.authorRajan, Uday
dc.contributorCohn, Jonathan B.
dc.contributorStrobl, Günter
dc.date.accessioned2013-12-12T17:42:25Z
dc.date.available2013-12-12T17:42:25Z
dc.date.issued2016-06
dc.identifier1214en_US
dc.identifier.urihttps://hdl.handle.net/2027.42/101908
dc.description.abstractWe study a model in which an issuer can manipulate information obtained by a credit rating agency (CRA) seeking to screen and rate its financial claim. Better CRA screening leads to a lower probability of obtaining a high rating but makes a high rating more valuable. Over an intermediate range of manipulation cost, improving screening quality can lead to more manipulation, dampening the CRA's incentive to screen. We further show that a CRA's own incentives to inflate ratings constrain its optimal screening intensity. Our model suggests that strategic disclosure by issuers may have played a role in recent ratings failures.en_US
dc.subjectcredit ratingen_US
dc.subjectscreeningen_US
dc.subjectstrategic disclosureen_US
dc.subject.classificationFinanceen_US
dc.titleCredit Ratings: Strategic Issuer Disclosure and Optimal Screeningen_US
dc.typeWorking Paperen_US
dc.subject.hlbsecondlevelEconomicsen_US
dc.subject.hlbtoplevelBusinessen_US
dc.contributor.affiliationumRoss School of Businessen_US
dc.contributor.affiliationotherMcCombs School of Business - University of Texasen_US
dc.contributor.affiliationotherFrankfurt School of Finance & Managementen_US
dc.contributor.affiliationumcampusAnn Arbor
dc.description.bitstreamurlhttp://deepblue.lib.umich.edu/bitstream/2027.42/101908/1/1214_Rajan.pdf
dc.description.bitstreamurlhttp://deepblue.lib.umich.edu/bitstream/2027.42/101908/4/1214_Rajan_June2016.pdf
dc.description.filedescriptionDescription of 1214_Rajan_June2016.pdf : June 2016 revision
dc.owningcollnameBusiness, Stephen M. Ross School of - Working Papers Series


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