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Country Risk Analysis: A Survey of the Quantitative Methods




With globalization and financial integration, there has been rapid growth of international lending and foreign direct investment (FDI). In view of this emerging trend, country risk analysis has become extremely important for the international creditors and investors. This paper briefly discusses the concepts and definitions, and presents a survey of the quantitative methods that are used to address various issues related to country risk. It also gives a summary review of selected empirical studies that use these techniques. While these studies display a distinct chronological pattern of gradual improvements in terms of technique and analytical competence none of them is adequate in terms of its scope and coverage. This paper also notes that in view of changing global economic and financial environment, greater availability of quantitative data, and enhanced computing capacity, the researchers should focus on the possibility of applying better techniques to more extensive models of country risk analysis.

Suggested Citation

  • Nath, Hiranya K., 2009. "Country Risk Analysis: A Survey of the Quantitative Methods," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 62(1), pages 69-94.
  • Handle: RePEc:ris:ecoint:0014

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    References listed on IDEAS

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    Cited by:

    1. Chopra, Parvesh K. & Kanji, Gopal K., 2010. "On Measuring Country Risk: A new System Modelling Approach - La misura del rischio paese: un nuovo approccio system modelling," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 63(4), pages 479-515.
    2. Brown, Christopher L. & Cavusgil, S. Tamer & Lord, A. Wayne, 2015. "Country-risk measurement and analysis: A new conceptualization and managerial tool," International Business Review, Elsevier, vol. 24(2), pages 246-265.

    More about this item


    Country Risk Analysis; International Lending; Foreign Direct Investment;

    JEL classification:

    • F30 - International Economics - - International Finance - - - General
    • G20 - Financial Economics - - Financial Institutions and Services - - - General


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