Economic Policy Uncertainty: Cross-Country Linkages and Spillover Effects on Economic Development in Some Belt and Road Countries

Abstract

With the increase of economic environment uncertainty, it is of great importance to study the linkage and spillover effects of economic policy uncertainty among countries. Especially, this article selects eight countries along the Belt and Road as the core countries (China, Korea, Croatia, India, Russia, Greece, Pakistan, and Singapore) and four countries (Germany, France, Japan, and UK) as the peripheral countries, and then copula technique and mixed-frequency global vector autoregressive model are employed to analyze the correlation and the spillover effect of the economic policy uncertainty (EPU) for the twelve selected countries, respectively. The proposed empirical findings show clearly that the EPU correlation among the eight core Belt and Road countries is stronger and the spillover effect of the core countries to the peripheral countries is statistically significant. As a result, for harmonious and win-win development, the Belt and Road countries should pay a close attention to the EPU, because the stability of the EPU promotes greatly the economy development.

Assessing the Belt and Road Initiative’s Impact: A Multi-Regression Model Based on Economic Interaction

“…At the regional economic level, existing studies have examined the overall economic impact of several regions in Asia and Europe, including South Asia [21][22][23], Central Asia [24][25][26], and Southeast Asia [7,27,28]. On the other hand, the studies on the economic levels of specific countries are centered around several countries central to the Belt and Road Initiative, such as India, Russia, and Singapore [29].…”