Since 2002, spreads on emerging market sovereign debt have fallen to historical lows. Given the close links between sovereign spreads, capital flows to emerging markets, and economic growth, understanding the factors driving these spreads is very important. We address this issue in two stages....

This paper focuses on emerging countries whose credit ratings are upgraded to investmentʺ level since 1990 and analyses the trends in selected financial and macroeconomic indicators before and after the upgrade decision. The analysis reveals that access to foreign capital gets easier after...

The purpose of this article is to analyse factors that can influence on the European country's credit rating. The analysis was performed according to the level of economic development in accordance with the division proposed by the World Bank. There were applied static and dynamic panel data...

We study the factors behind split ratings in sovereign credit ratings from different agencies, for the period 1980-2015. We employ random effects ordered and simple probit approaches to assess the explanatory power of different macroeconomic, government and financial variables. Our results show...

We examine whether changes in sovereign credit ratings assessments provided by rating agencies help to determine international bank flows to emerging countries. We focus on the quarterly banking flows of G7 countries to a sample of 55 emerging market borrowers for the period 1995-2008. We find...

This study investigates the nonlinear relationship between public debt and sovereign credit ratings, using a wide sample of over one hundred advanced, emerging, and developing economies. It finds that: i) higher public debt lowers the probability of being placed in a higher rating category; ii)...

Since 2002, spreads on emerging market sovereign debt have fallen to historical lows. Given the close links between sovereign spreads, capital flows to emerging markets, and economic growth, understanding the factors driving these spreads is very important. We address this issue in two stages....

I build a model where creditworthy countries may use fiscal austerity to communicate their ability to repay sovereign debt and show that the signaling channel is active only for high levels of asymmetric information. The model generates a negative association between the amount of public...

Using foreign currency long-term sovereign rating data from 93 countries and for more than 30 years, panel data econometric analyses show non-monotonic relation between pro-cyclicality of government consumption and sovereign risk scores. That is, countries with limited access to foreign credits...

Studies of world debt lending over the period 1976-1982 suggest that interest rates might have been inadequate for the risk assumed. This paper asserts that banks actually adjust a variety of risk factors, including interest rate, maturity, loan size, and grace period before amortization begins....