Investor-Paid Credit Ratings and Managerial Information Disclosure

References

• Ajinkya B , Bhojraj S , Sengupta P (2005) The association between outside directors, institutional investors and the properties of management earnings forecasts. J. Accounting Res. 43(3):343–376.Crossref, Google Scholar
• Alissa W , Bonsall SB IV , Koharki K , Penn MW Jr (2013) Firms’ use of accounting discretion to influence their credit ratings. J. Accounting Econom. 55(2–3):129–147.Crossref, Google Scholar
• Altonji JG , Elder TE , Taber CR (2005) Selection on observed and unobserved variables: Assessing the effectiveness of catholic schools. J. Political Econom. 113(1):151–184.Crossref, Google Scholar
• Amihud Y (2002) Illiquidity and stock returns: Cross-section and time-series effects. J. Financial Markets 5(1):31–56.Crossref, Google Scholar
• Badoer DC , Demiroglu C (2019) The relevance of credit ratings in transparent bond markets. Rev. Financial Stud. 32(1):42–74.Crossref, Google Scholar
• Badoer DC , Demiroglu C , James CM (2019) Ratings quality and borrowing choice. J. Finance 74(5):2619–2665.Crossref, Google Scholar
• Baghai RP, Becker B, Pitschner S (2023) The use of credit ratings in the delegated management of fixed income assets. Management Sci. 70(5):3059–3079.Google Scholar
• Baker AC , Larcker DF , Wang CC (2022) How much should we trust staggered difference-in-differences estimates? J. Financial Econom. 144(2):370–395.Crossref, Google Scholar
• Bao D , Kim Y , Mian GM , Su L (2019) Do managers disclose or withhold bad news? Evidence from short interest. Accounting Rev. 94(3):1–26.Crossref, Google Scholar
• Barrios JM (2021) Staggeringly problematic: A primer on staggered DiD for accounting researchers. Preprint, submitted March 17, https://dx.doi.org/10.2139/ssrn.3794859.Google Scholar
• Beaver WH , Shakespeare C , Soliman MT (2006) Differential properties in the ratings of certified vs. non-certified bond-rating agencies. J. Accounting Econom. 42(3):303–334.Crossref, Google Scholar
• Beyer A , Cohen DA , Lys TZ , Walther BR (2010) The financial reporting environment: Review of the recent literature. J. Accounting Econom. 50(2–3):296–343.Crossref, Google Scholar
• Bhagwat V , Dam R , Harford J (2016) The real effects of uncertainty on merger activity. Rev. Financial Stud. 29(11):3000–3034.Crossref, Google Scholar
• Bhattacharya U , Wei KD , Xia H (2019) Follow the money: Investor trading around investor-paid credit rating changes. J. Corporate Finance 58:68–91.Crossref, Google Scholar
• Bolton P , Freixas X , Shapiro J (2012) The credit ratings game. J. Finance 67(1):85–111.Crossref, Google Scholar
• Bongaerts D , Cremers KM , Goetzmann WN (2012) Tiebreaker: Certification and multiple credit ratings. J. Finance 67(1):113–152.Crossref, Google Scholar
• Bonsall S , Koharki K , Neamtiu M (2015) The effectiveness of credit rating agency monitoring: Evidence from asset securitizations. Accounting Rev. 90(5):1779–1810.Crossref, Google Scholar
• Bonsall SB IV , Koharki K , Neamtiu M (2017) When do differences in credit rating methodologies matter? Evidence from high information uncertainty borrowers. Accounting Rev. 92(4):53–79.Crossref, Google Scholar
• Bruno V , Cornaggia J , Cornaggia KJ (2016) Does regulatory certification affect the information content of credit ratings? Management Sci. 62(6):1578–1597.Link, Google Scholar
• Bushee BJ , Core JE , Guay W , Hamm SJ (2010) The role of the business press as an information intermediary. J. Accounting Res. 48(1):1–19.Crossref, Google Scholar
• Call AC , Martin GS , Sharp NY , Wilde JH (2018) Whistleblowers and outcomes of financial misrepresentation enforcement actions. J. Accounting Res. 56(1):123–171.Crossref, Google Scholar
• Campbell JY , Ramadorai T , Schwartz A (2009) Caught on tape: Institutional trading, stock returns, and earnings announcements. J. Financial Econom. 92(1):66–91.Crossref, Google Scholar
• Cengiz D , Dube A , Lindner A , Zipperer B (2019) The effect of minimum wages on low-wage jobs. Quart. J. Econom. 134(3):1405–1454.Crossref, Google Scholar
• Chapman K , Green JR (2018) Analysts’ influence on managers’ guidance. Accounting Rev. 93(1):45–69.Crossref, Google Scholar
• Clinch GJ , Li W , Zhang Y (2019) Short selling and firms’ disclosure of bad news: Evidence from Regulation SHO. J. Financial Reporting 4(1):1–23.Crossref, Google Scholar
• Cohen L , Malloy C , Nguyen Q (2020) Lazy prices. J. Finance 75(3):1371–1415.Crossref, Google Scholar
• Cohn JB , Liu Z , Wardlaw MI (2022) Count (and count-like) data in finance. J. Financial Econom. 146(2):529–551.Crossref, Google Scholar
• Coles JL , Daniel ND , Naveen L (2006) Managerial incentives and risk-taking. J. Financial Econom. 79(2):431–468.Crossref, Google Scholar
• Core J , Guay W (2002) Estimating the value of employee stock option portfolios and their sensitivities to price and volatility. J. Accounting Res. 40(3):613–630.Crossref, Google Scholar
• Cornaggia J , Cornaggia KJ (2013) Estimating the costs of issuer-paid credit ratings. Rev. Financial Stud. 26(9):2229–2269.Crossref, Google Scholar
• Dai L , Parwada JT , Zhang B (2015) The governance effect of the media’s news dissemination role: Evidence from insider trading. J. Accounting Res. 53(2):331–366.Crossref, Google Scholar
• Daley B , Green B , Vanasco V (2020) Securitization, ratings, and credit supply. J. Finance 75(2):1037–1082.Crossref, Google Scholar
• Dechow PM , Dichev ID (2002) The quality of accruals and earnings: The role of accrual estimation errors. Accounting Rev. 77(s-1):35–59.Crossref, Google Scholar
• Dong A , Massa M , Žaldokas A (2019) The effects of global leniency programs on margins and mergers. RAND J. Econom. 50(4):883–915.Crossref, Google Scholar
• Dye RA (1998) Investor sophistication and voluntary disclosures. Rev. Accounting Stud. 3(3):261–287.Crossref, Google Scholar
• Dye RA , Sridhar SS (1995) Industry-wide disclosure dynamics. J. Accounting Res. 33(1):157–174.Crossref, Google Scholar
• Fang VW , Huang AH , Karpoff JM (2016) Short selling and earnings management: A controlled experiment. J. Finance 71(3):1251–1294.Crossref, Google Scholar
• Gallemore J (2023) Bank financial reporting opacity and regulatory intervention. Rev. Accounting Stud. 28:1765–1810.Crossref, Google Scholar
• Gillette JR , Samuels D , Zhou FS (2020) The effect of credit ratings on disclosure: Evidence from the recalibration of Moody’s municipal ratings. J. Accounting Res. 58(3):693–739.Crossref, Google Scholar
• Glaeser S (2018) The effects of proprietary information on corporate disclosure and transparency: Evidence from trade secrets. J. Accounting Econom. 66(1):163–193.Crossref, Google Scholar
• Goldstein I , Huang C (2020) Credit rating inflation and firms’ investments. J. Finance 75(6):2929–2972.Crossref, Google Scholar
• Goldstein I , Yang L (2019) Good disclosure, bad disclosure. J. Financial Econom. 131(1):118–138.Crossref, Google Scholar
• Gormley TA , Matsa DA (2011) Growing out of trouble? Corporate responses to liability risk. Rev. Financial Stud. 24(8):2781–2821.Crossref, Google Scholar
• Gredil OR , Kapadia N , Lee JH (2022) On the information content of credit ratings and market-based measures of default risk. J. Financial Econom. 146(1):172–204.Crossref, Google Scholar
• Griffin JM , Tang DY (2012) Did subjectivity play a role in CDO credit ratings? J. Finance 67(4):1293–1328.Crossref, Google Scholar
• Griffin JM , Nickerson J , Tang DY (2013) Rating shopping or catering? An examination of the response to competitive pressure for CDO credit ratings. Rev. Financial Stud. 26(9):2270–2310.Crossref, Google Scholar
• Hand JR , Holthausen RW , Leftwich RW (1992) The effect of bond rating agency announcements on bond and stock prices. J. Finance 47(2):733–752.Crossref, Google Scholar
• He J , Qian J , Strahan PE (2011) Credit ratings and the evolution of the mortgage-backed securities market. Amer. Econom. Rev. 101(3):131–135.Crossref, Google Scholar
• Hirshleifer D , Teoh SH (2003) Limited attention, information disclosure, and financial reporting. J. Accounting Econom. 36(1–3):337–386.Crossref, Google Scholar
• Hope O-K , Liu J (2023) Does stock liquidity shape voluntary disclosure? Evidence from the SEC tick size pilot program. Rev. Accounting Stud. 28(4):2233–2270.Crossref, Google Scholar
• Houston JF , Lin C , Liu S , Wei L (2019) Litigation risk and voluntary disclosure: Evidence from legal changes. Accounting Rev. 94(5):247–272.Crossref, Google Scholar
• Hu X , Huang H , Pan Z , Shi J (2019) Information asymmetry and credit rating: A quasi-natural experiment from China. J. Banking Finance 106:132–152.Crossref, Google Scholar
• Jiang JX , Stanford MH , Xie Y (2012) Does it matter who pays for bond ratings? Historical evidence. J. Financial Econom. 105(3):607–621.Crossref, Google Scholar
• Jones JJ (1991) Earnings management during import relief investigations. J. Accounting Res. 29(2):193–228.Crossref, Google Scholar
• Jung W-O , Kwon YK (1988) Disclosure when the market is unsure of information endowment of managers. J. Accounting Res. 26(1):146–153.Crossref, Google Scholar
• Kasznik R , Lev B (1995) To warn or not to warn: Management disclosures in the face of an earnings surprise. Accounting Rev. 70(1):113–134.Crossref, Google Scholar
• Khan M , Lu H (2013) Do short sellers front-run insider sales? Accounting Rev. 88(5):1743–1768.Crossref, Google Scholar
• Kim I , Skinner DJ (2012) Measuring securities litigation risk. J. Accounting Econom. 53(1–2):290–310.Crossref, Google Scholar
• Kisgen DJ (2006) Credit ratings and capital structure. J. Finance 61(3):1035–1072.Crossref, Google Scholar
• Kliger D , Sarig O (2000) The information value of bond ratings. J. Finance 55(6):2879–2902.Crossref, Google Scholar
• Kothari SP , Leone AJ , Wasley CE (2005) Performance matched discretionary accrual measures. J. Accounting Econom. 39(1):163–197.Crossref, Google Scholar
• Kothari SP , Shu S , Wysocki PD (2009) Do managers withhold bad news? J. Accounting Res. 47(1):241–276.Crossref, Google Scholar
• Kraft P (2015) Do rating agencies cater? Evidence from rating-based contracts. J. Accounting Econom. 59(2–3):264–283.Crossref, Google Scholar
• Kronlund M (2020) Do bond issuers shop for favorable credit ratings? Management Sci. 66(12):5944–5968.Link, Google Scholar
• Li X , Yang HI (2016) Mandatory financial reporting and voluntary disclosure: The effect of mandatory IFRS adoption on management forecasts. Accounting Rev. 91(3):933–953.Crossref, Google Scholar
• Li Y , Zhang L (2015) Short selling pressure, stock price behavior, and management forecast precision: Evidence from a natural experiment. J. Accounting Res. 53(1):79–117.Crossref, Google Scholar
• Liu AZ , Subramanyam K , Zhang J , Shi C (2018) Do firms manage earnings to influence credit ratings? Evidence from negative credit watch resolutions. Accounting Rev. 93(3):267–298.Crossref, Google Scholar
• Massa M , Zhang B , Zhang H (2015) The invisible hand of short selling: Does short selling discipline earnings management? Rev. Financial Stud. 28(6):1701–1736.Crossref, Google Scholar
• Miller GS (2006) The press as a watchdog for accounting fraud. J. Accounting Res. 44(5):1001–1033.Crossref, Google Scholar
• Mummolo J , Peterson E (2018) Improving the interpretation of fixed effects regression results. Political Sci. Res. Methods 6(4):829–835.Crossref, Google Scholar
• Nagar V , Schoenfeld J , Wellman L (2019) The effect of economic policy uncertainty on investor information asymmetry and management disclosures. J. Accounting Econom. 67(1):36–57.Crossref, Google Scholar
• Oster E (2019) Unobservable selection and coefficient stability: Theory and evidence. J. Bus. Econom. Statist. 37(2):187–204.Crossref, Google Scholar
• Pinto J (2023) Mandatory disclosure and learning from external market participants: Evidence from the JOBS Act. J. Accounting Econom. 75(1):101528.Crossref, Google Scholar
• Piotroski JD , Roulstone DT (2004) The influence of analysts, institutional investors, and insiders on the incorporation of market, industry, and firm-specific information into stock prices. Accounting Rev. 79(4):1119–1151.Crossref, Google Scholar
• Poon WP (2003) Are unsolicited credit ratings biased downward? J. Banking Finance 27(4):593–614.Crossref, Google Scholar
• Rickmann GA (2022) The effect of market transparency on corporate disclosure: Evidence from the observability of bond prices and trading. Accounting Rev. 97(4):371–397.Crossref, Google Scholar
• Rosner J (2009) Toward an understanding: NRSRO failings in structured ratings and discreet recommendations to address agency conflicts. J. Structured Finance 14(4):7–22.Crossref, Google Scholar
• Sangiorgi F , Spatt C (2017) Opacity, credit rating shopping, and bias. Management Sci. 63(12):4016–4036.Link, Google Scholar
• Sethuraman M (2019) The effect of reputation shocks to rating agencies on corporate disclosures. Accounting Rev. 94(1):299–326.Crossref, Google Scholar
• Seybert N , Yang HI (2012) The party’s over: The role of earnings guidance in resolving sentiment-driven overvaluation. Management Sci. 58(2):308–319.Link, Google Scholar
• Skinner DJ (1997) Earnings disclosures and stockholder lawsuits. J. Accounting Econom. 23(3):249–282.Crossref, Google Scholar
• Subrahmanyam A , Titman S (2001) Feedback from stock prices to cash flows. J. Finance 56(6):2389–2413.Crossref, Google Scholar
• Sufi A (2009) The real effects of debt certification: Evidence from the introduction of bank loan ratings. Rev. Financial Stud. 22(4):1659–1691.Crossref, Google Scholar
• Tsang A , Xie F , Xin X (2019) Foreign institutional investors and corporate voluntary disclosure around the world. Accounting Rev. 94(5):319–348.Crossref, Google Scholar
• U.S. Senate Committee on Governmental Affairs (2002) Rating the raters: Enron and the credit rating agencies (S. Prt. 107). Government Printing Office, Washington, DC.Google Scholar
• Verrecchia RE (2001) Essays on disclosure. J. Accounting Econom. 32(1–3):97–180.Crossref, Google Scholar
• Xia H (2014) Can investor-paid credit rating agencies improve the information quality of issuer-paid rating agencies? J. Financial Econom. 111(2):450–468.Crossref, Google Scholar