How important are global geopolitical risks to emerging countries?

By C. H. J. Cheng, C. Chiu. The International Economy, 2018

204 citations recorded by the source corpus.

This paper shows that shocks to global geopolitical risk carry considerable business cycle implications for emerging economies. We estimate structural VAR models for 38 emerging countries and find evidence that these shocks are associated with significant economic contractions. The average share of output variation explained by global geopolitical risk shocks is between 13 and 22 percent. However, the individual share for each country varies vastly across our sample. The results remain robust when controlling for the terms of trade, global financial conditions, the US economic policy uncertainty and the US stock market volatility.

Subfields: Economics and Econometrics, Finance

View Paper: https://www.semanticscholar.org/paper/21600a59c19f257d0254156309bbd26cb2aafc30

How researchers see this paper

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In Economics and Econometrics

1. Zhou Lu
2. Marco Chi Keung Lau
3. Mai Huang
4. Giray Gozgor

In Finance

1. Giray Gozgor
2. Zhou Lu
3. Marco Chi Keung Lau
4. Mai Huang

Citations in the corpus

• The Impact of Geopolitical Risks on Financial Development: Evidence from Emerging Markets (2020, methodology): “Using a Structural Vector Autoregression (SVAR) model, Cheng & Chiu (2018) have shown that shocks as measured by GPR can explain 13%-22% of output variations in 38 emerging markets.”