COVID-19 Induced Economic Uncertainty: A Comparison between the United Kingdom and the United States
Articles
Ugur Korkut Pata
Osmaniye Korkut Ata University, Turkey
https://orcid.org/0000-0002-2853-4106
Published 2020-12-15
https://doi.org/10.15388/Ekon.2020.2.7
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Keywords

Economic Policy Uncertainty
COVID-19
Bootstrap ARDL
Lockdown

How to Cite

Pata U. K. (2020) “COVID-19 Induced Economic Uncertainty: A Comparison between the United Kingdom and the United States”, Ekonomika, 99(2), pp. 104-115. doi: 10.15388/Ekon.2020.2.7.

Abstract

The purpose of this study is to investigate the effects of the COVID-19 pandemic on economic policy uncertainty in the US and the UK. The impact of the increase in COVID-19 cases and deaths in the country and the increase in the number of cases and deaths outside the country may vary. To examine this, the study employs the bootstrap ARDL cointegration approach from March 8, 2020 to May 24, 2020. According to the bootstrap ARDL results, a long-run equilibrium relationship is confirmed for five out of the ten models. The long-term coefficients obtained from the ARDL models suggest that an increase in COVID-19 cases and deaths outside of the UK and the US has a significant effect on economic policy uncertainty. The US is more affected by the increase in the number of COVID-19 cases. The UK, on the other hand, is more negatively affected by the increase in the number of COVID-19 deaths outside the country than the increase in the number of cases. Moreover, another significant finding from the study demonstrates that COVID-19 is a factor of great uncertainty for both countries in the short-term.

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