We analyze how changes in government policy affect stock prices. Our general equilibrium model features uncertainty … average. The price fall is expected to be large if uncertainty about government policy is large, as well as if the policy … change is preceded by a short or shallow downturn. Policy changes increase volatility, risk premia, and correlations among …

We analyze how changes in government policy affect stock prices. Our general equilibrium model features uncertainty … average. The price fall is expected to be large if uncertainty about government policy is large, as well as if the policy … change is preceded by a short or shallow downturn. Policy changes increase volatility, risk premia, and correlations among …

We analyze how changes in government policy affect stock prices. Our general equilibrium model features uncertainty … average. The price fall is expected to be large if uncertainty about government policy is large, as well as if the policy … change is preceded by a short or shallow downturn. Policy changes increase volatility, risk premia, and correlations among …

We analyze how changes in government policy affect stock prices. Our general equilibrium model features uncertainty … should be large if uncertainty about government policy is large, and also if the policy change is preceded by a short or … shallow economic downturn. Policy changes should increase volatilities and correlations among stocks. The jump risk premium …

political uncertainty is priced in the equity option market as predicted by theory. Options whose lives span political events …We empirically analyze the pricing of political uncertainty, guided by a theoretical model of government policy choice …. To isolate political uncertainty, we exploit its variation around national elections and global summits. We find that …