Research Findings

Our data continues to uncover significant insights not found anywhere else.

  • Researchers use ICRG data to show that dependencies of political risk factors with stock and foreign exchange markets appear to be generally positive, while those with financial institutions and corporate bonds are adverse. K Gkillas, G Boako, D Vortelinos, & L Vasiliadis. “Non-parametric quantile dependencies between volatility discontinuities and political risk,” Finance Research Letters, Elsevier, vol. 32(C), Jan. 2020.
  • Researchers recently looked at how private debt systematically turns into higher public debt, which operates largely through the growth mechanism as opposed to explicit bailouts. Using our data on institutional quality, the paper found that private deleveraging weighs on activity, prompting a countercyclical government response to support economic growth. Consequently, whether this debt substitution results in a net increase or a net decline of overall indebtedness in the economy depends on the extent of the growth slowdown during the deleveraging spell. See S Mbaye, M Moreno Badia, K Chae, “Bailing Out the People? When Private Debt Becomes Public.” IMF Working Paper (18/141), Jun. 2018.
  • One recent study looked at the relationship between household debt and real GDP growth, using our financial risk metrics as a measure of a country’s ability to ‘pay its way’ by financing its official, commercial and trade debt obligations. See A Alter, A Xiaochen Feng, N Valckx, “Understanding the Macro-Financial Effects of Household Debt: A Global Perspective,” IMF Working Paper (18/76), Apr. 2018.
  • Another research paper considered whether early warning systems are effective in preventing/mitigating a fiscal crisis. Covering a panel of 119 countries, the study uses a range of ICRG risk metrics as a control for government stability, effectiveness, et al., and finds that fiscal adjustment is a good remedy for countries that act proactively, reducing their likelihood of facing a fiscal crisis by up to about 60%. See J Honda, R Tapsoba, I Issifou, “When Do We Repair the Roof? Insights from Responses to Fiscal Crisis Early Warning Signals,” IMF Working Paper (18/77), Apr. 2018.
  • Researchers 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 Staff 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.
  • In an informative IMF Working Paper, our ICRG risk metrics were used 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.
  • ICRG’s composite country risk scores were used 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.
  • Researchers looked at the behavior of emerging market equities and bonds and asked (inter alia): Which are more sensitive to global factors? Which chase returns? Which are more volatile? The results are significant for asset selection and portfolio balancing. See L Brandao-Marques, R G Gelos, H Ichiue, H Oura, “Changes in the Global Investor Base and the Stability of Portfolio Flows to Emerging Markets,” IMF Working Paper (15/277), Dec. 2015.
  • Our data was used 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.