Geopolitical risk, wartime economic policy uncertainty, and carbon intensity

Provash Sarker

EconStor Open Access Articles and Book Chapters, 2026, vol. 15, issue 3, 202-214

Abstract: We examine how geopolitical risk and wartime economic policy uncertainty affect carbon intensity (CI) in the United States. Using monthly data from 2000 to 2024 and employing a Quantile Vector Error Correction Model (QVECM) with the Caldara-Iacoviello Geopolitical Risk Index (GPR) and Brochet et al.’s adjusted Economic Policy Uncertainty index (AEPU), we uncover pronounced asymmetries across carbon intensity distributions. Error correction speeds exhibit a U-shaped pattern, with the strongest adjustments at extreme quantiles (24.5% at the 95th percentile) and the weakest around the median. Geopolitical risk increases carbon intensity during high-emission periods while policy uncertainty reduces it at both extremes. These findings highlight the need for distribution-sensitive climate policies during geopolitical crises

Keywords: geopolitical uncertainty; wartime policy uncertainty; decarbonization; quantile VEC; climate policy (search for similar items in EconPapers)
JEL-codes: C32 Q43 Q54 (search for similar items in EconPapers)
Date: 2026
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/342380/1/Sarker-Geopolitical-risk.pdf (application/pdf)

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:zbw:espost:342380

DOI: 10.17811/ebl.15.3.2026.202-214

Access Statistics for this article

More articles in EconStor Open Access Articles and Book Chapters from ZBW - Leibniz Information Centre for Economics Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().