The Effect of the US Macroeconomic Indicators on the International Geopolitical Risk

Osama D. Sweidan

Defence and Peace Economics, 2023, vol. 34, issue 4, 495-511

Abstract: The recent economic literature concludes that geopolitical risk has significantly impacted various economic variables over the past years. This paper focuses on a new dimension and seeks to answer if the US major macroeconomic indicators affect the international geopolitical risk (GPR). Based on our knowledge, there is no such study conducted so far, and thus, we propose to fill this gap. We constructed a theoretical framework and estimated an econometric model using the Autoregressive Distributed Lag methodology and quarterly data (1973–2020). The results show a statistically significant effect of the US macroeconomic variables on the GPR. The long-run results are decisive and unique, while the short-run influences are mixed in significance levels and signs. Hence, the short-run impact may differ over time and its final impact depends on the outweighing effect between the harmful and beneficial outcomes. The findings prove that a dominant country with economic and political powers can influence the GPR. From a policy implication side, we affirm that globalization should proceed side by side with cooperation and coordination among nations to solve economic glitches. Otherwise, geopolitical risk will make the economic performance worse.

Date: 2023
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://hdl.handle.net/10.1080/10242694.2022.2034103 (text/html)
Access to full text is restricted to subscribers.

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:taf:defpea:v:34:y:2023:i:4:p:495-511

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/GDPE20

DOI: 10.1080/10242694.2022.2034103

Access Statistics for this article

Defence and Peace Economics is currently edited by Professor Keith Hartley

More articles in Defence and Peace Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().