The Impact of Political Stability on the Effectiveness of the Early Warning Systems in Predicting the Financial Crises: The Case of Jordan and Qatar

Baker Shnekat and Ghazi Al-Assaf

International Journal of Financial Research, 2020, vol. 11, issue 4, 398-407

Abstract: The research aims to identify the impact of political stability in determining the effectiveness of early warning systems in predicting financial crises. The research applied a standard descriptive approach. In general, when comparing the two countries before including the model for economic variables the results showed that the nature of the impact of economic variables is different as the index of the financial crisis in Jordan is affected by the import of goods and services while the most influential indicators in the early warning model for the occurrence of the financial crisis in Qatar is the index of exporting goods and services on the basis that the system Qatari financial is very sensitive to the subject of export of gas and oil. Also, the results showed that there is a very significant impact of political stability on the financial crisis, which is greater than the impact of economic indicators, and if the two countries differed in which indicators for political stability have the greatest impact on the occurrence of the financial crisis, in Jordan the most influential indicator was the government effectiveness variable in Qatar, the regulatory quality index was the most influential.

Keywords: political stability; early warning systems financial crises; Jordan; Qatar (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:jfr:ijfr11:v:11:y:2020:i:4:p:398-407

DOI: 10.5430/ijfr.v11n4p398

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