Research Findings

Our data are used to uncover some very significant insights.

  • The IMF recently used ICRG’s composite risk scores as a proxy for institutional quality in determining the relationship between income and gender inequality and economic growth in Sub-Saharan Africa. See D Hakura, M Hussain, M Newiak, V Thakoor and F Yang, “Inequality, Gender Gaps and Economic Growth: Comparative Evidence for Sub-Saharan Africa,” IMF Working Paper (16/111), Jun. 2016.
  • The IMF used a series of ICRG metrics as a proxy for institutional quality in a recent policy paper on the macroeconomic gains in Latin America from regional integration. See “Financial Integration in Latin America,” IMF Staff Report (policy paper), Mar. 2016.
  • The IMF recently used our data in its most recent Working Papers, this time taking several International Country Risk Guide risk metrics to form a proxy for investment risk in order to ascertain the impact of commodity price shocks on financial sector fragility. See T Kinda, M Mlachila, and R Ouedraogo, “Commodity Price Shocks and Financial Sector Fragility,” IMF Working Paper (16/12), Feb. 2016.
  • The IMF has used ICRG’s composite country risk scores to draw correlations with public investment efficiency, defined as the ratio between the actual increment to public capital and the amount spent. See A Beg, EF Buffie, C Pattillo, A Presbitero and L-F Zanna, “Some Misconceptions about Public Investment Efficiency and Growth,” IMF Working Paper (15/272), Dec. 2015.
  • The IMF recently used ICRG data to construct a political stability index when investigating the effects of inflation targeting on the choice of exchange rate regimes in emerging markets.  See: “Inflation Targeting and Exchange Rate Regimes in Emerging Markets,” Christian Ebeke and Armand Fouejieu Azangue, IMF Working Paper (15/228), Oct. 2015.
  • IMF researchers recently used ICRG’s composite risk scores as the main proxy for overall country risk, finding that countries participating in IMF-supported lending programs are significantly less likely to experience a future banking crisis than nonborrowing countries, and that compliance with conditionality and loan size matter.” See “IMF Lending and Banking Crises,” Luca Papi, Andrea F. Presbitero and Alberto Zazzaro, IMF Working Paper (15/19), Jan. 2015.
  • A recent IMF study on the impact of revenue conditionality in Fund-supported programs used ICRG’s country corruption scores as a proxy for the strength of a country’s institutions.  The analysis found that revenue conditionality in such programs will potentially have the largest impact on countries with the strongest institutions or lowest corruption, thus confirming earlier results on the importance of institutions for fiscal policy implementation, especially in low-income countries. See “Does conditionality in IMF-supported programs promote revenue reform?” Ernesto Crivelli and Sanjeev Gupta, IMF Working Paper (14/206), Nov. 2014.
  • ICRG’s country risk index was used as a proxy for institutional quality in a recent IMF study on international bond issuance by debut issuers. See “First Time International Bond Issuance – New Opportunities and Emerging Risks,” Anastasia Guscina, Guilherme Pedras and Gabriel Presciuttini, IMF Working Paper (14/127), Jul. 2014.
  • IMF researchers have looked at energy security in the OECD by zeroing-in on the depth of the diversification of oil and natural gas supplies. Using ICRG data to model political risk, it was found that the extent of diversification changed if account was taken of the political risk attached to suppliers; the size of the importing country; and transportation risk. See “Measuring Energy Security: Trends in the Diversification of Oil and Natural Gas Supplies,” Gail Cohen, Frederick Joutz and Prakash Loungani, IMF Working Paper (11/39), Feb. 2011.
  • ICRG composite risk scores (which combine political, economic and financial risk data) were used recently by IMF researchers as a control for investment risk in order to determine the effectiveness of capital controls in response to inflow surges in Brazil, Colombia, Korea, and Thailand in the 2000s. Significantly, the researchers found that a higher ICRG index was associated with lower investment risk and thus likely to attract foreign capital. See “Effectiveness of Capital Controls in Selected Emerging Markets in the 2000s,” Chikako Baba and Annamaria Kokenyne, IMF Working Paper (11/281), Dec. 2011.
  • Several ICRG risk metrics − including our corruption scores − were recently used to help locate the determinates of fiscal policy behavior in a range of developed and emerging economies during the 1990-2012 period.  See:
    S Cevik and K Tekoz, “Deep Roots of Fiscal Behavior,” IMF Working Paper 14/15, Mar. 2014.
  • A series of ICRG risk metrics (viz., government stability, corruption, law and order, exchange rate stability, and inflation) were used by IMF researchers to help determine, econometrically, the impact of financial asset shortages in emerging markets on economic growth, asset price bubbles, and the probability of a crisis. The findings suggest that the consequences of asset shortages for macroeconomic stability are significant, and must be tackled urgently. See Imam, Patrick A. and Chen, Jiaqian, “Consequences of Asset Shortages in Emerging Markets.” IMF Working Paper (12/102), Monetary and Capital Markets, Apr. 2012.
  • ICRG’s risk metrics in the category “Investment Profile” were recently used to test the impact of public capital (state funds) on growth in 52 developing countries. Researchers in the IMF’s Fiscal Affairs Department and Strategy, Policy, and Review Department used our risk indicators to measure a government’s general attitude towards investment, and concluded they can be considered as a relatively close proxy of factors affecting public investment in a country. See S Gupta, et al., “Efficiency-Adjusted Public Capital and Growth,” IMF Working Paper (11/217), Sep. 2011.
  • ICRG risk metrics were used as a proxy for institutional quality, which was found helpful in explaining, in the run up to the global financial crisis, why countries in Central Eastern and Southeastern Europe attracted large capital inflows and why some generated large external imbalances. See the IMF study by Yuko Kinoshita, “Sectoral Composition of Foreign Direct Investment and External Vulnerability in Eastern Europe,” IMF Working Paper (11/123), Jun. 2011.
  • ICRG data was used to assess a range of “institutional factors” (e.g., government stability, corruption, investment climate) in assessing the effect of financial-sector reform on bank performance in selected Middle Eastern and North African (MENA) countries in the period 1994 − 2008. Despite similarities in the process of financial reforms undertaken in the five MENA countries under study, the observed efficiency levels of banks varied across markets, with Morocco consistently outperforming the rest of the region. See “What Drives the Performance of Selected MENA Banks? A Meta-Frontier Analysis,” Sami Ben Naceura, Hichem Ben-Khedhirib and Barbara Casu, IMF Working Paper (11/34), Feb. 2011.
  • Academics have used ICRG data on corruption and political stability to shed light on the reasons why manufacturing productivity has outpaced agricultural productivity in a number of Asian countries in recent years. “Factors Affecting Manufacturing and Agricultural Productivity Trends among Asian Countries,” Hasan Faruq and Peter J. Telaroli, Asian Economic Bulletin, Apr. 2011.
  • ICRG data was used to show that the presence of domestic conflict or major political instability has a large and negative effect on FDI inflows to emerging market economies, which highlights the role of inclusive policies to promote growth and avoid sudden stops of FDI inflows. See “Economic Policies and FDI Inflows to Emerging Market Economies” Elif Arbatli, IMF Working Paper (11/192), Aug. 2011.
  • Did you know that researchers from the IMF recently used 12 risk metrics from the ICRG’s political risk methodology to help determine why surges in capital flows to emerging markets occur, and what determines the allocation of capital across countries during such surge episodes. Domestically, it was found that, among other items, structural characteristics matter, which explains why not all emerging market economies experience surges. See “Surges,” Atish R. Ghosh, Jun Kim, Mahvash S. Qureshi, Juan Zalduendo, IMF Working Paper (12/22), Research Department, Jan. 2012.
  • A number of ICRG risk metrics were recently used by IMF researchers to help determine the linkages between “governance quality” and country “stress events” (fiscal and political). The researchers found that, internal accountability, which measures the responsiveness of governments to improving the quality of the bureaucracy, public service provision, and respect for the institutional framework in place, is positively associated with fiscal stress events. However, external accountability, which captures government accountability before the public in general, through elections and the democratic process, seems to be more important for political stress events. See “Country Stress Events: Does Governance Matter?” Carlos Caceres and Anna Kochanova, IMF Working Paper (12/116), May 2012.