Market values reveal countries' economic risks and global influences.
The article examines how the market views the financial health of countries by analyzing their sovereign asset values. By looking at data on credit default swaps, the researchers found that a country's debt positively affects its asset values, which can predict economic risks early on. They also discovered that countries with higher debt-to-asset ratios are more sensitive to global market changes, while those with lower ratios are more influenced by internal political stability.