COVID-Induced Economic Uncertainty

Medientyp: E-Book

Titel: COVID-Induced Economic Uncertainty

Beteiligte: Baker, Scott R. [VerfasserIn]; Bloom, Nicholas [Sonstige Person, Familie und Körperschaft]; Davis, Steven J. [Sonstige Person, Familie und Körperschaft]; Terry, Stephen J. [Sonstige Person, Familie und Körperschaft]

Körperschaft: National Bureau of Economic Research

Erschienen: Cambridge, Mass: National Bureau of Economic Research, 2020

Umfang: 1 Online-Ressource; illustrations (black and white)

Sprache: Englisch

DOI: 10.3386/w26983

Identifikator:

Reproduktionsnotiz: Hardcopy version available to institutional subscribers

Entstehung:

Anmerkungen: System requirements: Adobe [Acrobat] Reader required for PDF files
Mode of access: World Wide Web

Beschreibung: Assessing the economic impact of the COVID-19 pandemic is essential for policymakers, but challenging because the crisis has unfolded with extreme speed. We identify three indicators - stock market volatility, newspaper-based economic uncertainty, and subjective uncertainty in business expectation surveys - that provide real-time forward-looking uncertainty measures. We use these indicators to document and quantify the enormous increase in economic uncertainty in the past several weeks. We also illustrate how these forward-looking measures can be used to assess the macroeconomic impact of the COVID-19 crisis. Specifically, we feed COVID-induced first-moment and uncertainty shocks into an estimated model of disaster effects developed by Baker, Bloom and Terry (2020). Our illustrative exercise implies a year-on-year contraction in U.S. real GDP of nearly 11 percent as of 2020 Q4, with a 90 percent confidence interval extending to a nearly 20 percent contraction. The exercise says that about half of the forecasted output contraction reflects a negative effect of COVID-induced uncertainty

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