Abstract

SAN-MARTIN-ALBIZURI, Nerea  and  RODRIGUEZ-CASTELLANOS, Arturo. The Unpredictability of the Crisis: an Empirical Analysis of Country Risk Indexes. Innovar [online]. 2011, vol.21, n.39, pp.161-178. ISSN 0121-5051.

Although there were certain unique qualities among the factors that gave rise to the current crisis, we must not ignore the fact that it shares certain causes with previous crises that occurred during the "age of globalisation", particularly after 1994. One such feature is unpredictability. In that context, this study aims to determine whether the most widely known country risk indexes (Euromoney and ICRG) were able to anticipate crises that occurred between 1994 and 2002. For this purpose, we perform both discriminant and logistic regression analysis to check whether the values of the selected indexes, and their retards, can discriminate between a sample of countries in crisis and another sample of countries that did not enter into crisis. The results are negative, so we conclude that these indexes do not seem able to reflect the vulnerabilities that developed prior to the emergence of crisis episodes. This reinforces the idea that globalization has brought greater uncertainty to the global economic system.

Keywords : globalisation and uncertainty; external crisis prediction; country risk indexes; discriminant and logistic regression analysis.

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