Credit Rating Agencies, Finance and Growth
The aim of this chapter is to initiate a reflection about the potential connection between Credit Rating Agencies (CRA) performance and long-run macroeconomic performance based on the idea that inaccurate and volatile rating decisions can hinder the development of the financial system and therefore growth. This reflection is illustrated by means of the analysis of the evolution and correlations between relevant data on financial system development and growth for a sample of countries from the Euro Zone over the period 1990-2010. The preliminary descriptive analysis seems to corroborate the former concern since we found a positive correlation between different indicators of the development of the financial system, respectively, liquid liabilities, domestic credit to the private sector, and stock market capitalization, and real per capita output. The concerns with the economic impact of the functioning and performance of CRA should thus, in our opinion, also take a longer term perspective since they are a pillar of the financial system, which in turn is fundamental to sustain economic growth. Further restructuring and new interventions in the sector are needed in order to increase transparency and efficiency of CRA activity, preventing in this way longer term consequences in terms of growth potential.
|This chapter was published in: ||This item is provided by Institute of Economic Sciences in its series Book Chapters with number
euinpro-10.||Handle:|| RePEc:ibg:chaptr:euinpro-10||Contact details of provider:|| Postal: |
Phone: +381 11 2622 357, 2623 055
Fax: +381 11 2181 471
Web page: http://www.ien.bg.ac.rs
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Levine, Ross & Loayza, Norman & Beck, Thorsten, 1999.
"Financial intermediation and growth : Causality and causes,"
Policy Research Working Paper Series
2059, The World Bank.
- Ross Levine & Norman Loayza & Thorsten Beck, 2002. "Financial Intermediation and Growth: Causality and Causes," Central Banking, Analysis, and Economic Policies Book Series, in: Leonardo Hernández & Klaus Schmidt-Hebbel & Norman Loayza (Series Editor) & Klaus Schmidt-Hebbel (Se (ed.), Banking, Financial Integration, and International Crises, edition 1, volume 3, chapter 2, pages 031-084 Central Bank of Chile.
- Levine, Ross & Loayza, Norman & Beck, Thorsten, 2000. "Financial intermediation and growth: Causality and causes," Journal of Monetary Economics, Elsevier, vol. 46(1), pages 31-77, August.
- Thorsten Beck & Ross Levine & Norman Loayza, 1999. "Financial Intermediation and Growth: Causality and Causes," Working Papers Central Bank of Chile 56, Central Bank of Chile.
- Rabah Arezki & Bertrand Candelon & Amadou Sy, 2011.
"Sovereign Rating News and Financial Markets Spillovers: Evidence from the European Debt Crisis,"
CESifo Working Paper Series
3411, CESifo Group Munich.
- Bertrand Candelon & Amadou N. R. Sy & Rabah Arezki, 2011. "Sovereign Rating News and Financial Markets Spillovers; Evidence From the European Debt Crisis," IMF Working Papers 11/68, International Monetary Fund.
- Marwan Elkhoury, 2007. "Credit Rating Agencies And Their Potential Impact On Developing Countries," UNCTAD Discussion Papers 186, United Nations Conference on Trade and Development.
When requesting a correction, please mention this item's handle: RePEc:ibg:chaptr:euinpro-10. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zorica Bozic)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.