Do credit rating agencies influence elections?

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)


We show that credit rating agencies can influence political elections. We find that incumbent political parties experience an increase in their vote shares following municipal bond upgrades. The evidence is consistent with rating agencies affecting elections indirectly by expanding local governments' debt capacity and directly through an impact on voters' perceptions of the quality of incumbent politicians. To identify these effects, we examine election outcomes within neighboring counties by exploiting exogenous variation in municipal bond ratings due to Moody's recalibration of its scale in 2010.

Original languageEnglish
Pages (from-to)937-969
Number of pages33
JournalReview Of Finance
Issue number4
Publication statusPublished - 1 Jul 2022


  • Credit ratings
  • Economic conditions
  • Elections
  • Financial constraints
  • Government spending
  • Municipal bonds


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