The Economic Impact of US-China Tensions

Silvo Dajčman (), Dejan Romih () and Valentin Toader ()
Additional contact information
Silvo Dajčman: University of Maribor, Faculty of Economics and Business
Dejan Romih: University of Maribor, Faculty of Economics and Business
Valentin Toader: Babeș-Bolyai University, Faculty of Business

Chapter Chapter 2 in Innovation, Sustainability, and Growth in a VUCA Environment, 2026, pp 15-27 from Springer

Abstract: Abstract In this paper, we analyse the impact of a sudden and unexpected increase in US-China tensions on the US and Chinese economies using vector autoregression. We find that a positive shock in US-China tensions has a negative impact on both economies, although there are certain differences between them due to the characteristics of their economies and their ability to adapt to change. The findings indicate that a sudden and unforeseen rise in geopolitical frictions negatively influences industrial output and stock market performance in each country. However, the impact on exports presents a different picture—China appears to have greater flexibility in diversifying its global trade partnerships. The results of the study have policy implications as they emphasise the need to strengthen the resilience of both the US and Chinese economies to geopolitical shocks. This also applies to other economies.

Keywords: China; Shock; Tension; United States (search for similar items in EconPapers)
Date: 2026
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-3-032-11639-0_2

Ordering information: This item can be ordered from
http://www.springer.com/9783032116390

DOI: 10.1007/978-3-032-11639-0_2

Access Statistics for this chapter

More chapters in Springer Proceedings in Business and Economics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().