The Link Between Adherence to International Standards of Good Practice, Foreign Exchange Spreads, and Ratings

Author/Editor:

Andrew J Tiffin ; Christian B. Mulder ; Charalambos Christofides

Publication Date:

April 1, 2003

Electronic Access:

Download PDF. Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper examines the relationship between adherence to international standards of good practice in policy-making and two key indicators of access to capital markets and the cost of this access: spreads and sovereign ratings. In contrast to other work, this study reviews a broad set of indicators for adherence to international standards. The estimations are conducted for emerging market economies, and pay particular attention to issues of persistence in spreads and ratings and nonlinearities in the relationships. The main finding confirms the expectation that standards are indeed relevant. Accounting standards and property rights are especially important for spreads, in addition to data transparency (SDDS subscription). Accounting standards and corruption are especially important in explaining ratings in addition to trade protectiveness (not a standard).

Series:

Working Paper No. 03/74

Subject:

English

Publication Date:

April 1, 2003

ISBN/ISSN:

9781451849615/1018-5941

Stock No:

WPIEA0742003

Price:

$15.00 (Academic Rate:$15.00)

Format:

Paper

Pages:

31

Please address any questions about this title to publications@imf.org