Global trade flows and economic policy uncertainty
Tam,Pui Sun
Source PublicationApplied Economics
ABS Journal Level2
ISSN14664283 00036846

This article investigates the impacts of economic policy uncertainty (EPU) on global trade flows in gauging international trade developments. We employ a global vector autoregressive (GVAR) trade model, augmented with value-added bilateral trade linkages, that allows for quantifying the effects of economy-specific uncertainty shocks on exports and imports of individual economies. We find substantial spatial propagation in the temporal dynamics of international transmission of shocks amidst the manifestations of cross-border global value chains (GVCs) with China’s accession into the WTO. We provide evidence for the significance of EPU of China and the United States, particularly the latter, in influencing global trade flows. Our results show that while the US impacts can largely be attributed to its indirect trade linkages with other economies, the impacts of China can be relegated more to its direct GVC linkages. The findings have implications on trade protectionist inclinations of the current-term US government and the ongoing efforts of China’s policymakers in steering macroeconomic rebalancing for sustainable growth.

KeywordEconomic Policy Uncertainty Global Vector Autoregression Trade Value-added
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Cited Times [WOS]:11   [WOS Record]     [Related Records in WOS]
Document TypeJournal article
Corresponding AuthorTam,Pui Sun
AffiliationDepartment of Finance and Business Economics,Faculty of Business Administration,University of Macau,,Taipa,Macao
First Author AffilicationFaculty of Business Administration
Corresponding Author AffilicationFaculty of Business Administration
Recommended Citation
GB/T 7714
Tam,Pui Sun. Global trade flows and economic policy uncertainty[J]. Applied Economics,2018,50(34-35):3718-3734.
APA Tam,Pui Sun.(2018).Global trade flows and economic policy uncertainty.Applied Economics,50(34-35),3718-3734.
MLA Tam,Pui Sun."Global trade flows and economic policy uncertainty".Applied Economics 50.34-35(2018):3718-3734.
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