Organizational Capital and Credit Ratings

Authors

Humnath Panta, California State Polytechnic University, HumboldtFollow
Arun Narayanasamy, University of Northern IowaFollow
Ayush Panta, University of California, Berkeley

Document Type

Article

Keywords

Credit rating, Organizational capital

Journal/Book/Conference Title

Finance Research Letters

Volume

57

Abstract

This study uses pooled OLS to examine the effect of organizational capital on credit ratings using a large sample of US firm data from 1989 to 2017. The main finding reveals that firms with higher organizational capital receive higher credit ratings. This finding is robust to numerous robustness tests, alternative estimation techniques, and attempts to mitigate omitted variable and endogeneity concerns. Further, the positive effect of organizational capital on credit ratings is more prominent when firms are more financially constrained. Overall, our findings reveal the importance of organizational capital in the credit ratings of a firm.

Department

Department of Finance

Original Publication Date

11-1-2023

DOI of published version

10.1016/j.frl.2023.104277

Recommended Citation

Panta, Humnath; Narayanasamy, Arun; and Panta, Ayush, "Organizational Capital and Credit Ratings" (2023). Faculty Publications. 5458.
https://scholarworks.uni.edu/facpub/5458