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Published in: Journal of Economics and Finance 4/2022

02-07-2022

Trilemma of pandemic-related health emergency, economic policy uncertainty and partisan conflict in the United States: A time-varying analysis evidence

Authors: Seyi Saint Akadiri, Andrew Adewale Alola, Ahdi Noomen Ajmi

Published in: Journal of Economics and Finance | Issue 4/2022

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Abstract

The events in the year 2020, especially the ravaging coronavirus (COVID-19) pandemic has further exposed the vulnerability and connectedness associated with human health and the global economy. In the United States, amid the COVID-19 pandemic, the recent political polarization, especially the sharp divide between the Republican and Democrat party has further demonstrated the heightened partisan conflict in the country. From this basis, the current study examines the time-varying Granger causality between pandemic-related health emergency, partisan conflict, and economic policy uncertainty (EPU) in the United States over period January 1996 to June 2020. While there is an evidence of common time-varying Granger causality between August 2005 and September 2006 from pandemic-related health emergency to partisan, the evidence of Granger causality from partisan conflict to pandemic is common in the period of January to May 2009. In addition, the Granger causality between partisan conflict and EPU is obviously common between February and May 2020. As a policy concern, we are of the opinion that mechanism toward diffusing the heightened political divide in the United States is essential and be pursued for the country’s economic and health sector challenges.
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Footnotes
1
This motivates the authors to examine the interaction between the variables under observation.
 
2
Categorical Data include a range of sub-indexes derived only from news data by employing the World News database of over 2,000 US newspapers. The sub-indexes encompass economic, uncertainty, and policy terms and some categorical policy terms.
 
3
The Partisan Conflict Index tracks the degree of political disagreement among U.S. politicians at the federal level by measuring the frequency of newspaper articles reporting disagreement in a given month. Higher index values indicate greater conflict among political parties, Congress, and the President.
 
4
The World pandemic uncertainty (2020) index is computed by using the following keywords in the Economist Intelligence Unit country reports: Severe Acute Respiratory Syndrome, SARS, Avian flu, H5N1, Swine flu, H1N1, Middle East respiratory syndrome, MERS, Bird flu, Ebola, Coronavirus, Covid-19, Influenza, H1V1, World Health Organisation, and WHO.
 
5
For more details, please see Shi et al., 2018.
 
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Metadata
Title
Trilemma of pandemic-related health emergency, economic policy uncertainty and partisan conflict in the United States: A time-varying analysis evidence
Authors
Seyi Saint Akadiri
Andrew Adewale Alola
Ahdi Noomen Ajmi
Publication date
02-07-2022
Publisher
Springer US
Published in
Journal of Economics and Finance / Issue 4/2022
Print ISSN: 1055-0925
Electronic ISSN: 1938-9744
DOI
https://doi.org/10.1007/s12197-022-09590-y

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