Evaluating the effect of geopolitical risks on the growth rates of emerging countries

Barış Soybilgen (), Huseyin Kaya and Dincer Dedeoglu ()
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Dincer Dedeoglu: Bahcesehir University

Economics Bulletin, 2019, vol. 39, issue 1, 717-725

Abstract: In this study, we analyze the relationship between geopolitical risks and growth using annual panel data from 18 emerging countries for the period from 1986 to 2016. For a robustness check, we use panel data with 5-year intervals. The news-based indices of Caldara and Iacoviello (2018) were used as a proxy for geopolitical risks. Our results show that the effect of geopolitical risks on growth rates is negative and significant. A 10 point increase in the geopolitical risk index causes a 0.2–0.4% decline in the GDP growth rate.

Keywords: Geopolitical Risk; Growth; Emerging Markets; Panel Data (search for similar items in EconPapers)
JEL-codes: O1 O4 (search for similar items in EconPapers)
Date: 2019-03-28
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Citations: View citations in EconPapers (15)

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