Research Seminar "Economic Knock-On Effects of Russia’s Geopolitical Risk on Advanced Economies: A Global VAR Approach" (Michael Funke)

Economic Knock-On Effects of Russia’s Geopolitical Risk on Advanced Economies: A Global VAR Approach

8 Feb 2024 at 14.00 - 15.00 Delta room 1024 and Zoom

Michael Funke (Hamburg University)

Using Russia as a case study and a global VAR model as methodological tool, we analyze how heightened geopolitical risk shocks propagate across the advanced economies and quantify the economic effects. The global VAR impulse response functions in response to the skyrocketing Russian geopolitical risk shock after Russia's invasion of Ukraine reveal a contraction of GDP and an increase of inflation. Eastern European neighboring countries are particularly affected by the Russian geopolitical risk shock. we also document a strong component of the Russian geopolitical risk shock which is not driven by fossil fuel prices.

Article is available here

Co-authors: Boris Blagov and Maximilian Dirks

Zoom Meeting ID: 964 9710 5088

Passcode: 308330