NORDSCI Conference proceedings 2021, Book 2

Economics and Tourism

THE IMPACT OF ECONOMIC POLICY UNCERTAINTY ON INDUSTRIAL PRODUCTION IN THE UNITED STATES: PRE-PANDEMIC EVIDENCE

Dejan Romih

ABSTRACT

Although the Covid-19 pandemic (the Great Lockdown), which began in March 2020, is not over yet (mainly due to new SARS-CoV-2 variants, such as Delta), there is already a growing body of evidence that suggests that the Covid-19 pandemic has contributed to an increase in economic policy uncertainty in the United States and the rest of the world. In this paper, I examine the impact of economic policy uncertainty on industrial production in the United States before the Covid-19 pandemic. Using vector autoregression, I found that industrial production in the United States responds negatively to a positive economic policy uncertainty shock in the United States. This suggests that US economic policymakers need to prevent economic policy uncertainty in the United States

KEYWORDS

Covid-19, economic policy, industrial production, uncertainty, United States, vector autoregression, VAR model

REFERENCE

NORDSCI Conference proceedings 2021, Book 2, Conference Proceedings, ISSN 2603-4107, ISBN 978-619-7495-14-0, THE IMPACT OF ECONOMIC POLICY UNCERTAINTY ON INDUSTRIAL PRODUCTION IN THE UNITED STATES: PRE-PANDEMIC EVIDENCE, 157-165 pp, DOI paper 10.32008/NORDSCI2021/B2/V4/14