Do social factors contribute to Sovereign (Country) default risk premium?
More and more research has indicated the importance of incorporating ESG factors into key financial management decisions. Social factors in particular are understood to be an indication of overall strength of national wellbeing and hence credit resilience. Therefore, with this paper, we examined ini...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
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Elite Scientific Forum
2024
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| Online Access: | http://psasir.upm.edu.my/id/eprint/117751/ http://psasir.upm.edu.my/id/eprint/117751/1/117751.pdf |
| _version_ | 1848867331282829312 |
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| author | Ahmed, Zeshan Ali, Rosalan Johari, Jalila |
| author_facet | Ahmed, Zeshan Ali, Rosalan Johari, Jalila |
| author_sort | Ahmed, Zeshan |
| building | UPM Institutional Repository |
| collection | Online Access |
| description | More and more research has indicated the importance of incorporating ESG factors into key financial management decisions. Social factors in particular are understood to be an indication of overall strength of national wellbeing and hence credit resilience. Therefore, with this paper, we examined initially the role of specific macroeconomic factors into pricing the sovereign credit default swaps (S-CDS). We then included into our model certain factors that collectively indicate a country’s overall social performance. Subsequently, we explored for any variation in findings by segregating countries across various income levels and regional classifications. With this paper, we intend to guide national governments on how they can benefit from lower borrowing costs by simply improving their social indicators. Our findings confirm that some, not all, social factors do play a role in sending signals to financial markets to price the credit default spreads for sovereign borrowers. Hence, national governments and policy makers can prioritize improving their social indicators given their respective individualities. |
| first_indexed | 2025-11-15T14:34:48Z |
| format | Article |
| id | upm-117751 |
| institution | Universiti Putra Malaysia |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-15T14:34:48Z |
| publishDate | 2024 |
| publisher | Elite Scientific Forum |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | upm-1177512025-06-11T07:14:02Z http://psasir.upm.edu.my/id/eprint/117751/ Do social factors contribute to Sovereign (Country) default risk premium? Ahmed, Zeshan Ali, Rosalan Johari, Jalila More and more research has indicated the importance of incorporating ESG factors into key financial management decisions. Social factors in particular are understood to be an indication of overall strength of national wellbeing and hence credit resilience. Therefore, with this paper, we examined initially the role of specific macroeconomic factors into pricing the sovereign credit default swaps (S-CDS). We then included into our model certain factors that collectively indicate a country’s overall social performance. Subsequently, we explored for any variation in findings by segregating countries across various income levels and regional classifications. With this paper, we intend to guide national governments on how they can benefit from lower borrowing costs by simply improving their social indicators. Our findings confirm that some, not all, social factors do play a role in sending signals to financial markets to price the credit default spreads for sovereign borrowers. Hence, national governments and policy makers can prioritize improving their social indicators given their respective individualities. Elite Scientific Forum 2024 Article PeerReviewed text en http://psasir.upm.edu.my/id/eprint/117751/1/117751.pdf Ahmed, Zeshan and Ali, Rosalan and Johari, Jalila (2024) Do social factors contribute to Sovereign (Country) default risk premium? Pakistan Journal of Life and Social Sciences (PJLSS), 22 (2). pp. 14675-14699. ISSN 1727-4915; eISSN: 2221-7630 https://pjlss.edu.pk/pdf_files/2024_2/14675-14699.pdf 10.57239/pjlss-2024-22.2.001056 |
| spellingShingle | Ahmed, Zeshan Ali, Rosalan Johari, Jalila Do social factors contribute to Sovereign (Country) default risk premium? |
| title | Do social factors contribute to Sovereign (Country) default risk premium? |
| title_full | Do social factors contribute to Sovereign (Country) default risk premium? |
| title_fullStr | Do social factors contribute to Sovereign (Country) default risk premium? |
| title_full_unstemmed | Do social factors contribute to Sovereign (Country) default risk premium? |
| title_short | Do social factors contribute to Sovereign (Country) default risk premium? |
| title_sort | do social factors contribute to sovereign (country) default risk premium? |
| url | http://psasir.upm.edu.my/id/eprint/117751/ http://psasir.upm.edu.my/id/eprint/117751/ http://psasir.upm.edu.my/id/eprint/117751/ http://psasir.upm.edu.my/id/eprint/117751/1/117751.pdf |