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The Global Transmission of Real Economic Uncertainty

Author

Listed:
  • JUAN M. LONDONO
  • SAI MA
  • BETH ANNE WILSON

Abstract

Using a sample of 39 countries representing 88% of global GDP, we find that real economic uncertainty (REU) has negative long‐lasting domestic economic effects and transmits across countries. The international spillover effects of REU are both statistically significant and economically meaningful, and trade ties play a key role in explaining its transmission across countries. Innovations to the foreign component of global REU can contribute up to 16% of the future variation in domestic industrial production. This effect is disproportionately larger on its manufacturing component, which contributes the most to the tradable goods sector, than on its retail sales component.

Suggested Citation

  • Juan M. Londono & Sai Ma & Beth Anne Wilson, 2025. "The Global Transmission of Real Economic Uncertainty," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 57(5), pages 1103-1133, August.
    • Handle: RePEc:wly:jmoncb:v:57:y:2025:i:5:p:1103-1133
    DOI: 10.1111/jmcb.13161
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    References listed on IDEAS

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