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The empirical investigation of which risk factorpolitical or financialis the optimal driver of country risk in emerging economies in the twentyfirst century has grown into a significant and volatile issue in recent decades This paper investigates the linkages between political risk and financial risk in four Balkan economies ie Greece Albania Bulgaria and Romania from 1984 Q3 to 2018 Q4 using nonlinear autoregressive distributed lag cointegration NARDL and wavelet coherence approaches As a result findings from the links between political risk and financial risk are being used to provide significant insights into effective urban planning in Balkan cities The outcomes of the NARDAL analysis indicate that there are shortterm and longterm asymmetric links between political risk and financial risk in the Balkan countries except for Romania The wavelet coherence study also revealed that there is significant vulnerability between political risk and financial risk at different frequencies in the region also political risk is a key for predicting financial risk over the selected study period at different frequencies in Albania and Bulgaria
