Biglaiser and DeRouen (2007)- Sovereign Bond Ratings and Neoliberalism in Latin America

Biglaiser and DeRouen (2007)- Sovereign Bond Ratings and Neoliberalism in Latin America

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Sovereign Bond Ratings and Neoliberalism in Latin America By: Glen Biglaiser and Karl DeRouen, Jr. Biglaiser, Glen, and Karl DeRouen, Jr. 2007. “Sovereign Bond Ratings and Neoliberalism in Latin America.” International Studies Quarterly. 51: 121-138. Abstract: The importance of credit rating agencies (CRAs) in rating sovereign bonds has grown as developing countries increasingly issue bonds to attract foreign capital. Although in their methodologies CRAs claim that initiation of neoliberal reforms influences bond ratings, given the secrecy around ratings, it is unclear what impact reforms actually have on CRAs. Controlling for macroeconomic and political determinants, we use statistical analyses, as well as recent qualitative evidence, for some 16 Latin American countries from 1992-2003 to assess the effects of economic reforms on CRA decisions. We find that among neoliberal policies, only trade liberalization positively and consistently impacts bond ratings. The relative ease of implementation
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This note was uploaded on 02/03/2012 for the course POLS 5308 taught by Professor Biglaiser during the Spring '11 term at Texas Tech.

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Biglaiser and DeRouen (2007)- Sovereign Bond Ratings and Neoliberalism in Latin America

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