Credit Rating Agency Announcements and the Eurozone Sovereign Debt Crisis

This paper studies the impact of credit rating agency (CRA) announcements on the value of the Euro and the yields of French, Italian, German and Spanish long-term sovereign bonds during the culmination of the Eurozone debt crisis in 2011-2012. The employed GARCH models show that CRA downgrade announcements negatively affected the value of the Euro currency and also increased its volatility. Downgrading increased the yields of French, Italian and Spanish bonds but lowered the German bond's yields, although Germany's rating status was never touched by CRA. There is no evidence for Granger causality from bond yields to rating announcements. We infer from these findings that CRA announcements significantly influenced crisis-time capital allocation in the Eurozone. Their downgradings caused investors to rebalance their portfolios across member countries, out of ailing states' debt into more stable borrowers' securities

Corporate social responsibility: The good, the bad and the ugly

In this article I critically analyze contemporary discourses of corporate social responsibility and related discourses of sustainability and corporate citizenship. I argue that despite their emancipatory rhetoric, discourses of corporate citizenship, social responsibility and sustainability are defined by narrow business interests and serve to curtail interests of external stakeholders. I provide an alternate perspective, one that views discourses of corporate citizenship, corporate social responsibility, and sustainability as ideological movements that are intended to legitimize and consolidate the power of large corporations. I also problematize the popular notion of organizational 'stakeholders'. I argue that stakeholder theory of the firm represents a form of stakeholder colonialism that serves to regulate the behavior of stakeholders. I conclude by discussing implications for critical management studies

How Well Do We Understand Sovereign Debt Crisis? Evidence from Latin America

In recent years, the number of theoretical models on sovereign default exploded. I take a step back and investigate how good our current theoretical understanding of real world sovereign debt crisis really is. This is done by deriving implications that are hard wired into our models and comparing the evolution of nearly 20 sovereign debt crises in Latin America with them. I find that the available models capture aspects of virtually all crises, yet there are only a few crisis that are fully consistent with the available models