The Relative Importance of Political and Economic Variables in Creditworthiness Ratings
13 Pages Posted: 15 Feb 2006
Date Written: April 1998
Abstract
This study examines the relative importance of political and economic variables in the determination of a country`s standing in credit ratings provided by commercial rating agencies. It finds that creditworthiness appears to be determined primarily by economic variables. While including political events can improve the explanatory power of the regressions, the exclusion of political variables does not bias the parameter estimates for the effects of economic variables.
Keywords: Credit ratings, creditworthiness
JEL Classification: G15, G24, P52
Suggested Citation: Suggested Citation
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