Scott Baker, Aniket Baksy, Nicholas Bloom, Steven Davis, Jonathan Rodden 22 December 2020
Elections can cause economic uncertainty, especially when elections take place in a politically polarised context. This column studies how national election cycles in 23 countries influence economic policy uncertainty, as measured by the share of newspaper articles that discusses uncertainty and economic policy. Economic policy uncertainty clearly rises in the months leading up to national elections. Average economic policy uncertainty values are 13% higher in the month before and the month of national elections than in other months during the same election cycle. In the US, economic policy uncertainty increases are especially pronounced around close and highly polarised presidential elections.