Geopolitical crises and economic policy uncertainty: Time series analysis from the United States

Isa Camyar and Bahar Ulupinar

Research in Economics, 2025, vol. 79, issue 3

Abstract: Economic policy uncertainty (EPU) is empirically associated with a variety of economic and financial outcomes. However, its sources remain understudied. In this study, we analyze the long-run and short-run impacts of geopolitical crises on EPU by using evidence from the United States (U.S.) for the period of 1985-2019. We present a time series analysis, specifically the autoregressive distributive lag model, on a monthly dataset with the indicators of EPU and geopolitical crises. We find that the impact of geopolitical crises on EPU is conditional and temporal, meaning that it is significant only if the U.S. is directly involved or an active participant in them and materializes over time.

Keywords: Policy uncertainty; Geopolitical crisis; The United States (search for similar items in EconPapers)
JEL-codes: E4 E5 F5 H0 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:reecon:v:79:y:2025:i:3:s1090944325000389

DOI: 10.1016/j.rie.2025.101061

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