Do Rating Agencies Behave Defensively for Higher Risk Issuers?

The authors thank Sanjeev Bhojraj (discussant), Lauren Cohen, Paul Fischer, Paul Healy, John Jiang, Monica Neamtiu, Ed Owens (discussant), David Yu, and Mina Zarrin, as well as workshop participants at the AAA Annual Meeting; Information, Markets, and Organizations Conference at the Harvard Business School; PwC Young Scholars Research Symposium at the University of Illinois; University of California, Los Angeles; and the Wharton School for helpful comments. The authors thank Moody’s Investors Service for assistance with its Default and Recovery Database. The authors also thank the Harvard Business School, HEC Paris, Krannert School of Management, and Smeal College of Business. In addition, the authors thank Cesare Fracassi, Stefan Petry, and Geoffrey Tate for generously sharing their demographic trait data on individual credit rating analysts.