Sovereign Credit Ratings, Emerging Market Risk and Financial Market Volatility: A Commentary

Writing a commentary invariably means choosing between two basic alternatives. One is to attempt to approach the topic of the paper from a slightly different angle, which is often done uncritically. Usually this type of procedure neither sparks debate nor generates stimulating ideas. Due to the coherent and concise nature of the very informative paper by Helmut Reisen and Julia von Maltzan as well as the solid empirical basis on which the study is founded, this approach would probably not work. Their paper was so fruitful that I was left with the other choice, which, to put it briefly, was to track down the few remaining inconsistencies and to scrutinise the authors' findings critically.

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