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Implementation of Multi-Objective Evaluation Method in Public Debt Risk Management

Author

Listed:
  • Jelena Stankevičienė

    (Vilnius Gediminas Technical University)

  • Sergej Rosov

    (Vilnius Gediminas Technical University)

Abstract

The paper is devoted to propose a public debt risk assessment model, which allows predicting country's economic well-being trends. The proposed model evaluates different aspects of public debt-related structural indicators. Introduced debt risk assessment model uses MULTIMOORA multi-objective evaluation method. Study is based on the 2005-2010 European Union macroeconomic structural indicators. The data analysis indicates EU's ability to cope with the increasing level of public debt and predict long term fiscal consequences. Evaluation of research results enables to use multi-objective evaluation method to determine the risk of public debt. A ranking index which shows early warning signs of fiscal indebtedness problems for European Union countries is introduced in the paper. Periodical use of proposed model would help to predict incoming recessions and to implement specific fiscal policies in time to prevent them.

Suggested Citation

  • Jelena Stankevičienė & Sergej Rosov, 2013. "Implementation of Multi-Objective Evaluation Method in Public Debt Risk Management," Entrepreneurial Business and Economics Review, Centre for Strategic and International Entrepreneurship at the Cracow University of Economics., vol. 1(4), pages 7-19.
    • Handle: RePEc:krk:eberjl:v:1:y:2013:i:4:p:7-19
    as

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    File URL: http://eber.uek.krakow.pl/index.php/eber/article/download/24/27
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    References listed on IDEAS

    as
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    6. Marcio Garcia & Roberto Rigobon, 2004. "A Risk Management Approach to Emerging Market's Sovereign Debt Sustainability with an Application to Brazilian Data," NBER Working Papers 10336, National Bureau of Economic Research, Inc.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    public debt; risk; MULTIMOORA; MOORA; structural indicators; European Union;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors

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