The increased importance of rating agencies for emerging-market finance has brought their work to the attention of a wider group of observers — and under criticism. This paper evaluates whether the importance of ratings for developing-country finance has changed since the Asian Crisis and...

This article presents event studies that find a significant effect on dollar bond yield spreads when rating agencies put emerging-market sovereign bonds on review with negative outlook. The finding has two conditional implications. If rating agencies can be turned from late into early warning...