Working Papers

The pandemic-induced global economic crisis has contributed to the re-emergence of sovereign default risk, especially for emerging and developing economies, and has directed attention to the impact of the institutions that are tasked with attempting to predict defaults: the international credit rating agencies. This paper describes four main challenges posed by credit rating agencies, especially from a developing and emerging economies perspective: potential bias in ratings, pro-cyclicality of ratings, governance issues and conflicts of interest, and incorporation of climate risk. It concludes with potential policy solutions addressed at ratings agencies, regulators, and policy makers.…

This paper conceptualizes recently negotiated international agreements, particularly the 2030 Agenda for Sustainable Development, as a collective roadmap to overcome challenges associated with globalization. By analyzing the effects and implications of globalization on societies and economies, the paper highlights concrete aspects of the international commitments that address globalization challenges in the three dimensions of sustainable development. Particular focus is placed on global production patterns, labor markets, poverty and inequality, global imbalances, migration and climate change. The paper concludes that, in the context of a changing political economy of globalization and…

The prolonged sluggishness in the world economy since the global financial crisis has led to growing calls for a reorientation of macroeconomic policies toward more supportive fiscal measures. Such calls inevitably invite the question of how much fiscal space governments actually have. This paper provides a systematic review of the most popular definitions and measures of fiscal space. It examines the evolution of fiscal space measures and discusses the pros and cons of each measure. It then outlines several key factors that could help to further strengthen existing approaches and allow a more comprehensive assessment of fiscal space. By illustrating how different measures paint…