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this approach takes into account that the transmission of a shock might depend on the sign and the size of the shock. Large …
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Using a novel set of instrumental variables in a structural VAR framework, we investigate the economic impact of uncertainty shocks stemming from geopolitical swings in South Korea. We construct robust instrumental variables for examining the variations in uncertainty due to geopolitical swings...
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What is the dominant driver of macroeconomic uncertainty? Is it the aggregate demand or the aggregate supply shock? In …. However, an identified uncertainty shock in the data causes a contraction in output and significant declines in consumption … uncertainty resemble the impact of a negative demand shock. These findings suggest that the long-lived supply-driven uncertainty …
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