Rating Standards around the World: A Puzzle?

55 Pages Posted: 6 Mar 2019 Last revised: 7 Mar 2023

See all articles by Najah Attig

Najah Attig

Dalhousie University

Hamdi Driss

Saint Mary's University

Sadok El Ghoul

University of Alberta - Campus Saint-Jean

Date Written: February 26, 2019


Using panel data on S&P’s credit ratings for firms from 63 countries over the 2000–2016 period, we uncover divergent patterns in the rating standards over time. Standards strengthen by 1.5 notches for U.S. firms and by 2.2 notches for other developed country firms, but weaken by 1.2 notches for emerging country firms. Default and credit spread tests show that standards tightening for U.S. and other developed country firms is likely unwarranted, whereas standards loosening for firms in emerging economies appears to be justified. This novel and puzzling evidence suggests that S&P does not adopt consistent global standards over time.

Suggested Citation

Attig, Najah and Driss, Hamdi and El Ghoul, Sadok, Rating Standards around the World: A Puzzle? (February 26, 2019). Emerging Markets Review, Available at SSRN: https://ssrn.com/abstract=3341809 or http://dx.doi.org/10.2139/ssrn.3341809

Najah Attig

Dalhousie University ( email )

Rowe School of Business
6100 University Avenue
Halifax, Nova Scotia B3H 4R2
902-494-7486 (Phone)

HOME PAGE: http://scholar.google.ca/citations?user=J53887sAAAAJ&hl=en

Hamdi Driss

Saint Mary's University ( email )

923 Robie St.
Saint Mary's University - FISMS
Halifax, Nova Scotia B3H 3C3

HOME PAGE: http://Hamdi.Driss@smu.ca

Sadok El Ghoul (Contact Author)

University of Alberta - Campus Saint-Jean ( email )

Edmonton, Alberta T6G 2R3
780-465-8725 (Phone)
780-465-8760 (Fax)

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