In this paper, we contribute to the discussion of what determines country risk by arguing that an important explanatory factor is the impact that commodities have on the capacity to pay. We use a newly created data base with state-level fiscal and risk premium data for Brazil states between 1891...

Recent research into international trade has highlighted the role of trade costs in determining the geography of trade. We propose that the notion of comparative advantage has to be expanded to include different capacities to transact and the pertinent factor endowments (organizational and...