Open AccessEconomic Policy Uncertainty in the United States and Europe: A Cointegration Test
Author(s) -
Vichet Sum
Publication year - 2013
Publication title -
international journal of economics and finance
Language(s) - English
Resource type - Journals
eISSN - 1916-9728
pISSN - 1916-971X
DOI - 10.5539/ijef.v5n2p98
Subject(s) - cointegration , economics , transmission channel , state (computer science) , macroeconomics , test (biology) , international economics , economic policy , transmission (telecommunications) , econometrics , algorithm , computer science , electrical engineering , engineering , paleontology , biology
Economic uncertainty is closely followed and analysed by businesses, policy makers and academic scholars because the world economies have now become very closely interconnected more than ever. This study is to examine a relationship between economic policy uncertainty between the United States and Europe. The results reveal a long-run equilibrium relationship (cointegration) in economic policy uncertainty between the United States and Europe. The findings provide evidence of the interconnectedness of economic conditions between the United State and Europe in line with the international transmission and spill-over literature.