Michael Frenkel

Bert Scholtens

Alexander Karmann

Sovereign risk and financial crises play a key role in current international economic developments, particularly in the case of economic downturns. As the Asian economic crisis in the late 1990s revealed once again, financial crises are the rule rather than the exception in capitalist economies. The event also revealed that international public debt agreements are contingent claims. In a world of increasing economic interdependencies, the issues of financial crises and country defaults are of critical importance. This volume goes to the heart of the academic discussion on sovereign risk and financial crises by centering on quantitative-empirical aspects, evaluating prominent approaches, and by proposing new methods. Part I of the volume identifies key factors and processes that are central in analyzing sovereign risk while Part II focuses on the determinants and effects of financial crises.

Sovereign Risk and Financial Crises

Wim Vandekerckhove

Jos Leys

Kristian Alm

Silvana Signori

Henry Schäfer

The SRI phenomenon is said to be entering the mainstream of financial intermediation. From a fairly marginal practice promoted or campaigned for by NGO’s and at odds with financial practice and orthodoxy it grew into well formulated policy adopted by a wide range of investors. Academic literature on SRI has also boomed on the assumption that mainstreaming is taking place. However, little thinking has been carried out on questions specifically arising from this alleged ‘mainstreaming’. This book, addressed to those with a scholarly or practitioner’s interest in SRI, starts filling this neglected dimension. Today, one cannot ignore the difficulties of main stream financing. The financial spheres are trembling globally in one of the worst crises since the 1930’s. As a response to the crisis, the intermediation of ‘financial responsibility’ will undoubtedly be the subject of new regulation and scrutinizing. This book looks into what these turbulences will imply for SRI. In view of these circumstances, one might or even should, ask oneself whether the phenomenon was not an empty fad during the exuberant high of financial euphoria that came abruptly to an end with current financial crises. To put it rather sec: are financial intermediaries that promote ‘sustainability’ credible, while it is obvious that some developments in financial intermediation -predictably, as some say- were unsustainable? Is this an opportunity for enhancing SRI because of the strength and superiority it has developed or will it disappear due to a return to financial myopia? This book is the first to question the future of SRI in such a radical way.

Responsible Investment in Times of Turmoil

Bert Scholtens

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