The Italian downgrade announcements: which effects?

In last years the concept of rating took an important role in the economic world; in fact the rating agencies assessments on the sovereign credit produced effects on political and economic sphere. This paper is interested in the last phase of the crisis, qualified as the Sovereign debt crisis, occurred in the last four years after the sovereign rating review by the rating agencies. The first sovereign rating downgrade occurred in US on August 5, 2011 when Standard & Poor’s downgraded the United States credit rating from AAA to AA+ with the motivation that the plan that the Congress and the Administration agreed could not stabilize the government’s medium-term debt dynamics. This announcement caused a financial crisis which spread like a domino on other countries. Afterwards, other downgrades occurred in European countries that caused an upheaval on the European financial market. An interesting aspect for this analysis is the following: such downgrades have had different impacts depending on the macroeconomic conditions. The paper represents an empirical investigation because it applies the inductive reasoning, is based on the observation of a large number of cases, states the hypothesis and provides a generalization about the events observed. The scientific approach is used because we search for knowledge by starting from the literature contributions, formulating the question and the hypotheses of research, collecting data, developing the survey and finally we analyze the findings and make conclusions through the generalization of our results.