Policy uncertainty and consumption in G7 countries: An asymmetry analysis

In this study, we aim at assessing the effects of policy uncertainty on consumption in G7 countries. Unlike previous research, we take an additional step and show that the impacts are asymmetric, which helps us to have a better understanding of the effects of increased versus decreased uncertainty i...

Full description

Saved in:
Bibliographic Details
Published in:International economics (Paris) 2020-10, Vol.163, p.101-113
Main Authors: Bahmani-Oskooee, Mohsen, Maki Nayeri, Majid
Format: Article
Language:English
Subjects:
Asymmetry
Consumption
Policy uncertainty
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:In this study, we aim at assessing the effects of policy uncertainty on consumption in G7 countries. Unlike previous research, we take an additional step and show that the impacts are asymmetric, which helps us to have a better understanding of the effects of increased versus decreased uncertainty in the G7 economies. Our results suggest that policy uncertainty has indeed asymmetric effects on consumer expenditure in all G7 countries. These findings imply that the positive and the negative shocks could not offset each other’s impact on consumption, which leads to a different path of consumption before and after a period with a high level of uncertainty.
ISSN:2110-7017
DOI:10.1016/j.inteco.2020.06.001