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Article

Trade Policy Uncertainty Effects on Macro Economy and Financial Markets: An Integrated Survey and Empirical Investigation

Department of Economics, University of Thessaly, 38333 Volos, Greece
J. Risk Financial Manag. 2021, 14(1), 41; https://doi.org/10.3390/jrfm14010041
Received: 5 January 2021 / Accepted: 14 January 2021 / Published: 18 January 2021
(This article belongs to the Collection International Trade Theory and Policy)
This paper conducts a review on theoretical and empirical findings on the increasingly popular measure of trade policy uncertainty (TPU) in economics and finance. Moreover, an empirical investigation takes place in order to find the impact that TPU exerts on Bitcoin market values by employing a spectrum of Generalized Autoregressive Conditional Heteroskedasticity (GARCH) specifications. Existing studies support that trade policy uncertainty leads to lower-quality and more expensive products and weak participation in international trade. Moreover, it contributes to lower democratic sentiment, hesitant internal migration and lesser socio-economic mobility and higher fluctuations in profitable assets. Moreover, our econometric findings reveal that TPU positively affects Bitcoin prices while crude oil values negatively influence this major cryptocurrency. Thereby, higher trade policy uncertainty is found to increase demand and favorite investments into risky assets in order to ameliorate the risk-return trade-off in investors’ portfolios. This study provides a compass for investing during turmoil due to trade wars and tariffs. View Full-Text
Keywords: trade policy uncertainty; survey; macro economy; financial markets; Bitcoin trade policy uncertainty; survey; macro economy; financial markets; Bitcoin
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MDPI and ACS Style

Kyriazis, N.A. Trade Policy Uncertainty Effects on Macro Economy and Financial Markets: An Integrated Survey and Empirical Investigation. J. Risk Financial Manag. 2021, 14, 41. https://doi.org/10.3390/jrfm14010041

AMA Style

Kyriazis NA. Trade Policy Uncertainty Effects on Macro Economy and Financial Markets: An Integrated Survey and Empirical Investigation. Journal of Risk and Financial Management. 2021; 14(1):41. https://doi.org/10.3390/jrfm14010041

Chicago/Turabian Style

Kyriazis, Nikolaos A. 2021. "Trade Policy Uncertainty Effects on Macro Economy and Financial Markets: An Integrated Survey and Empirical Investigation" Journal of Risk and Financial Management 14, no. 1: 41. https://doi.org/10.3390/jrfm14010041

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