ABSTRACT
Assessing the financial stability of the banking industry, particularly in credit risk management, has become extremely crucial in times of uncertainty. Given that, this paper aims to investigate the determinants of the interconnectedness of sectoral credit risk default for developing countries. To that purpose, we employ a dynamic credit risk model that considers a variety of macroeconomic indicators, bank-specific variables, and household characteristics. Moreover, the SURE model is used to analyze empirical data. We find the connection between macroeconomic, bank-specific, and household characteristics, and sectoral default risk. The outcomes of macroeconomic factors demonstrate that few macroeconomic determinants significantly influence the sector's default risk. The empirical results of household components reveal that educated households play a substantial role in decreasing sectoral loan defaults interconnectedness and vice versa. While for bank-specific characteristic, we find that greater bank profitability and specialization have substantially reduced loan defaults.
ABSTRACT
Covid-19 vaccination was associated with a general feeling of hesitancy, and its arrival increased fear and economic anxiety. This paper investigates the impacts of Covid-19 vaccination on fear and economic anxiety using a worldwide sample of 194 countries observed from December 1st, 2020 to March 4th, 2021. The difference-in-differences investigation approach shows that with the vaccine's arrival, the Google search trends measuring fear and anxiety are increasing. The arrival of the vaccine has created a general feeling of fear, and people have a lack of confidence in the vaccine's efficiency to overcome the Covid-19 crisis. Specifically, anxiety increased when the delta variant was discovered in India. Governments' interventions must ensure that the Covid-19 vaccine does not have adverse side effects that can harm public health. We suggested that policy makers should focus on increasing the number of older adults willing to receive the vaccine. It can be effective in explaining the benefits of the vaccine, and denying false information about the vaccine and its serious side effects.
