Unveiling the impact of foreign competition on the bond market: Insights from S&P debt ratings

Ruwan Lasantha, Vincent Tawiah, Muhammad Atif, Prem Puwanenthiren and Sivathaasan Nadarajah

Economics Letters, 2024, vol. 241, issue C

Abstract: This study investigates the influence of foreign competition on U.S. firms’ debt ratings. The findings reveal a significant downgrade in ratings with increased foreign competition, in particular affecting firms with prospector strategies, low organizational capital, high information asymmetry, weak governance, and reshaping creditworthiness assessment.

Keywords: Foreign competition; Debt ratings; Governance; Creditworthiness (search for similar items in EconPapers)
JEL-codes: E44 F65 G14 G15 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:241:y:2024:i:c:s0165176524002817

DOI: 10.1016/j.econlet.2024.111797

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