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Predicting Financial Crises and Signal Indicators in G7 Countries

Author

Listed:
  • Alpdoğan Hilal

    (Sakarya University of Applied Science, Sakarya, Turkey.)

  • Akal Mustafa

    (Sakarya University, Sakarya, Turkey.)

  • Kabasakal Ali

    (Sakarya University, Sakarya, Turkey.)

  • Görmüş Şakir

    (Marmara University, İstanbul, Turkey.)

Abstract

This study aims to detect financial crises and their signal indicators in G7 countries from 1990 to 2016. For this purpose, fourteen leading economic indicators supported by the economic literature were examined for signaling and the 24-month crisis window before the beginning of a crisis. Among them, successful crisis estimators were determined by the noise signal ratio. The identified crisis estimators provide essential information about the dynamics of economies and the channels of the crisis affecting them. Our findings may help policymakers determine adverse policies against crisis, avoid significant losses, and stabilize the world economy and national economies.

Suggested Citation

  • Alpdoğan Hilal & Akal Mustafa & Kabasakal Ali & Görmüş Şakir, 2023. "Predicting Financial Crises and Signal Indicators in G7 Countries," Zagreb International Review of Economics and Business, Sciendo, vol. 26(1), pages 29-53.
    • Handle: RePEc:vrs:zirebs:v:26:y:2023:i:1:p:29-53:n:1002
    DOI: 10.2478/zireb-2023-0002
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    References listed on IDEAS

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    More about this item

    Keywords

    Financial Crises; Signal Approach; KLR Approach; G7 Countries;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G17 - Financial Economics - - General Financial Markets - - - Financial Forecasting and Simulation
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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