"Structure and Asymptotic Theory for Multivariate Asymmetric Volatility: Empirical Evidence for Country Risk Ratings"

Following the rapid growth in the international debt of less developed countries in the 1970s and the increasing incidence of debt rescheduling in the early 1980s, country risk has become a topic of major concern for the international financial community. A critical assessment of country risk is essential because it reflects the ability and willingness of a country to service its financial obligations. Various risk rating agencies employ different methods to determine country risk ratings, combining a range of qualitative and quantitative information regarding alternative measures of economic, financial and political risk into associated composite risk ratings. This paper provides an international comparison of country risk ratings compiled by the International Country Risk Guide (ICRG), which is the only international rating agency to provide detailed and consistent monthly data over an extended period for a large number of countries. As risk ratings can be treated as indexes, their rate of change, or returns, merits attention in the same manner as financial returns. For this reason, a constant correlation multivariate asymmetric ARMA-GARCH model is presented and its underlying structure is established, including the unique, strictly stationary and ergodic solution of the model, its causal expansion, and convenient sufficient conditions for the existence of moments. Alternative empirically verifiable sufficient conditions for the consistency and asymptotic normality of the quasi-maximum likelihood estimator are established under non-normality of the conditional (or standardized) shocks. The empirical results provide a comparative assessment of the conditional means and volatilities associated with international country risk returns across countries and over time, enable a validation of the regularity conditions underlying the models, highlight the importance of economic, financial and political risk ratings as components of a composite risk rating, evaluate the multivariate effects of alternative risk returns and different countries, and evaluate the usefulness of the ICRG risk ratings in modelling risk returns.

ALBANIA'S ECONOMIC POLICIES IN THE CONTEXT OF EUROPEAN SOCIAL MODEL

This paper examines the key aspects of the main social insurance programs development in Europe, and in Albania, during different periods of time, in order to face the elements of this model, as well as the respective development. Employment and a welfare regime are both the key elements of the social model. The first element refers to the way how industrial relations are regulated, the skills development and wage settlements. The second element refers to the way how social protection is organized and social services are provided by the state, market and family in the production and distribution of welfare. Employment and welfare regimes are related, but not necessarily coherent in a wide period and intensive institutional change. The paper notes that dimension of the state welfare in the economic system is a sensitive topic in European integration. This is due to the emphasis given to the purpose of the competition, closely linked to the EU, as well as the strong relation between European social model and integration in the European Union, whose candidate status also Albania holds

Remittances and Poverty in Albania

With increasing labor and capital mobility in the world, remittance flows have risen significantly to become the second source after FDI of external funding for developing countries. Remittances are now viewed by many development practitioners as an important development tool for recipient countries. This paper studies the impact of remittances on poverty in Albania –one of the top 20 remittance-receiving countriesin the world. It is found that remittances have a significant impact on the reduction of absolute povertyin the country by directly raising household income and consumption. However, sinceemigration is costly, remittances do not reach the poorest individuals, which can have a negative impact on inequality. Moreover, there seems to be a high degree of dependency on remittances in Albania, both on the micro and macro level. Therefore, the sustainability of this source of income is of special concern

Outsourcing in Kosovo: An analysis of Kosovo\u27s comparative advantage and the potential for growth

The main focus of this research project is to explore the implications of outsourcing on the service provider countries, specifically for the case of Kosovo. With the emergence of globalization, international markets are more interconnected than ever. Technology has facilitated businesses with different ways of reducing costs, one of them being outsourcing part of their business processes internationally, also known as offshore outsourcing. While the impact of such strategies on the client countries is controversial, there is almost universal agreement that the impact on provider countries, especially when they are developing countries, is positive. Being a developing country, Kosovo can also benefit from improving its services trade balance, and one way to achieve that is by the expansion and development of its outsourcing sector. Using both primary and secondary data research, this study analyzes Kosovo’s outsourcing sector, the potential for development, and the main challenges faced by startup businesses in this sector. Since there is limited existing data (both qualitative and quantitative) regarding Kosovo’s potential as an outsourcing destination, this study can contribute in filling in some of the gaps. Based on first-hand information from representatives of existing outsourcing companies in Kosovo, as well as examples from literature on other countries, a list of recommendations for the Kosovar government and other stakeholders is provided

Basal Ganglia Infarct in Young Female Patient: in Consideration with D.V.T and Paradoxical Emboli

Twenty four years old female presented on the 20th postnatal day with painful swelling of her limbs (more in the lower limbs) along with headache, nausea, and right sided weakness. On the basis of the history, relevant physical examination and investigations (C.T scan brain and echocardiography) she was diagnosed to have a paradoxical emboli from D.V.T (deep venous thrombosis) of her legs that reached her brain through patent foramen oval causing a basal ganglia infarct. Based on her serum albumin and ascetic albumin, her diagnosis was made which was in the favor of nephrotic syndrome. She was heparinized and anti-platelets aggregating therapy was initiated for her deep venous thrombosis. She was advised to get physiotherapy for the weakness she had on her right side. Because of timely diagnosis and early treatment her weakness had a gross improvement and she was able to start moving her limbs by herself at the time of hospital discharge.   &nbsp

Value-at-Risk for Country Risk Ratings

The country risk literature argues that country risk ratings have a direct impact on the cost of borrowings as they reflect the probability of debt default by a country. An improvement in country risk ratings, or country creditworthiness, will lower a country's cost of borrowing and debt servicing obligations, and vice-versa. In this context, it is useful to analyse country risk ratings data, much like financial data, in terms of the time series patterns, as such an analysis provides policy makers and industry stakeholders with a more accurate method of forecasting future changes in the risks and returns associated with country risk ratings.