Accounting and Finance Seminars- Elisabeth Kempf (Chicago Booth)

7 June 2019, 1.00 PM - 7 June 2019, 2.15 PM

Elisabeth Kempf

G.15, 15-19 Tyndalls Park Road

Title - Partisan Professionals: Evidence from Credit Rating Analysts

Partisan perception affects the actions of professionals in the nancial sector. Using a novel dataset linking credit rating analysts to party affliations from voter records, we show that analysts who are not affliated with the U.S. president's party downward-adjust corporate credit ratings more frequently. By comparing analysts with different party affliations covering the same rm in the same quarter, we ensure that differences in rm fundamentals cannot explain the results. We also nd a sharp divergence in the rating actions of Democratic and Republican analysts around the 2016 presidential election. Our results suggest partisan perception has implications fi rms' cost of capital.

Edit this page