The impact of fundamental uncertainties on economic growth

YALÇINKAYA Ö., ÇELİK A. K.

ACTA OECONOMICA, cilt.71, sa.2, ss.213-234, 2021 (SSCI) identifier identifier

  • Yayın Türü: Makale / Tam Makale
  • Cilt numarası: 71 Sayı: 2
  • Basım Tarihi: 2021
  • Doi Numarası: 10.1556/032.2021.00011
  • Dergi Adı: ACTA OECONOMICA
  • Derginin Tarandığı İndeksler: Social Sciences Citation Index (SSCI), Scopus, International Bibliography of Social Sciences, Periodicals Index Online, EconLit, Geobase, Index Islamicus
  • Sayfa Sayıları: ss.213-234
  • Atatürk Üniversitesi Adresli: Evet

Özet

This paper addresses the impact of fundamental (economic, political and geopolitical) uncertainties on GDP growth of the world's largest 20 economies (W-20) using the Cobb-Douglas total production function within the scope of the second-generation panel data methodology for 1990-2016. The aim of the paper is to explore whether these uncertainties lead to a contractionary impact on growth as suggested by the economic theory. The estimation results revealed that indeed this was the case. Our results also indicate that the global uncertainties led the economic growth rates of the selected countries to perform below their exact potential since the 2008 global economic crisis and to fail to attain an expected recovery during the process.