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The Impact of Covid-19 and Crude Oil Price on Economic Policy Uncertainty; Evidence From an Emerging Market Economy

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  • Umut Burak Geyikci

    (Manisa Celal Bayar University)

Abstract

This study measured the short-run and long-run effects of covid-19 on economic policy uncertainty (epu) using daily data from 04.04.2020 to 16.09.2020 and the autoregressive distributed lag (ardl) model. In addition, the impact of crude oil price on epu was measured.according to the ardl bound test results, covid-19 new deaths and covid-19 new cases had a significant impact on the epu in both short-run and long-run, while the effect of recovery was not found. In addition, the brent crude oil price also has an inverse and significant effect on the epu. The findings of the study show that while the decline in oil price is expected to cause a decrease in the current account deficit and therefore a decrease in uncertainty in an emerging economy where the current account deficit creates extreme fragility, covid-19 has increased uncertainty by dominating this situation.

Suggested Citation

  • Umut Burak Geyikci, 2021. "The Impact of Covid-19 and Crude Oil Price on Economic Policy Uncertainty; Evidence From an Emerging Market Economy," Journal of Finance Letters (Maliye ve Finans Yazıları), Maliye ve Finans Yazıları Yayıncılık Ltd. Şti., vol. 36(115), pages 103-118, April.
    • Handle: RePEc:acc:malfin:v:36:y:2021:i:115:p:103-118
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets

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