Assessing New Perspectives on Country Risk

20 Pages Posted: 14 May 2012 Last revised: 29 Sep 2013

See all articles by Claudio E. V. Borio

Claudio E. V. Borio

Bank for International Settlements (BIS) - Research and Policy Analysis

Frank Packer

Bank for International Settlements (BIS)

Date Written: December 1, 2004

Abstract

We examine in a unified framework three recent perspectives on country risk: debt intolerance, original sin, and currency mismatches. We find statistical evidence supporting aspects of all three, though the strength of that support varies considerably across hypotheses and a number of open questions remain. Our evidence is consistent with the view that good domestic macroeconomic and structural policies hold the key to addressing country risk.

JEL Classification: F30, G15

Suggested Citation

Borio, Claudio E.V. and Packer, Frank, Assessing New Perspectives on Country Risk (December 1, 2004). BIS Quarterly Review, December 2004, Available at SSRN: https://ssrn.com/abstract=1967457

Claudio E.V. Borio (Contact Author)

Bank for International Settlements (BIS) - Research and Policy Analysis ( email )

CH-4002 Basel, Basel-Stadt
Switzerland

Frank Packer

Bank for International Settlements (BIS) ( email )

CH-4002 Basel, Basel-Stadt
Switzerland
4161 280 8449 (Phone)

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