The End of Gatekeeping: Underwriters and the Quality of Sovereign Bond Markets, 1815-2007

Marc Flandreau, Juan Huitzilihuitl Flores Zendejas, Norbert Gaillard and Nieto-Parra, Sebastián

No 7347, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We provide a comparison of salient organizational features of primary markets for foreign government debt over the very long run. We focus on output, quality control, information provision, competition, pricing, charging and signaling. We find that the market set up experienced a radical transformation in the recent period and interpret this as resulting from the rise of liability insurance provided by rating agencies. Underwriters have given up their former role as gatekeepers of liquidity and certification agencies to become aggressive competitors in a new speculative grade market.

Keywords: banks competition; certification; primary bond market; sovereign debt crises (search for similar items in EconPapers)
JEL-codes: F34 G14 G24 N2 (search for similar items in EconPapers)
Date: 2009-06

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Working Paper: The End of Gatekeeping: Underwriters and the Quality of Sovereign Bond Markets, 1815-2007 (2009)
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