We present a simple theory of the quality (competence and honesty) of elected officials. Our theory offers four main insights. Low-quality citizens have a 'comparative advantage' in pursuing elective office, because their market wages are lower than those of high-quality citizens (competence),...

This paper explores the economic role credit rating agencies play in the corporate bond market. We consider three existing theories about multiple ratings: information production, rating shopping and regulatory certification. Using differences in rating composition, default prediction and credit...