Leading Indicators of Fiscal Distress is popular PDF and ePub book, written by Martin Bruns in 2016-02-15, it is a fantastic choice for those who relish reading online the Business & Economics genre. Let's immerse ourselves in this engaging Business & Economics book by exploring the summary and details provided below. Remember, Leading Indicators of Fiscal Distress can be Read Online from any device for your convenience.
Leading Indicators of Fiscal Distress Book PDF Summary
Early warning systems (EWS) are widely used for assessing countries’ vulnerability to fiscal distress. Most EWS employ a specific set of only fiscal leading indicators predetermined by the researchers, which casts doubt on their robustness. We revisit this issue by using the Extreme Bound Analysis, which allows identifying robust leading indicators of fiscal distress from a large set. Consistent with the theoretical predictions of latest generation crisis models, we find that both fiscal (e.g., fiscal balance, foreign exchange debt) and non-fiscal leading indicators (e.g., output, FX reserves, current account balance, and openness) are robust. In addition, we find that a fiscal vulnerability indicator based on fiscal and non-fiscal leading indicators offers a 29% gain in predictive power compared to a traditional one based on fiscal leading indicators only. It also has good predictive power out of sample, with 78 percent of crises predicted correctly and only 34 percent false alarms issued for the period 2008–15. This suggests that both fiscal and non-fiscal leading indicators should be taken into account when assessing country’s vulnerability to fiscal distress.
Detail Book of Leading Indicators of Fiscal Distress PDF
- Author : Martin Bruns
- Release : 15 February 2016
- Publisher : International Monetary Fund
- ISBN : 9781475594799
- Genre : Business & Economics
- Total Page : 37 pages
- Language : English
- PDF File Size : 19,8 Mb
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