Partisan conflict and asset prices
Loading...
Date
2024-09-30
Authors
Μπινιέρης, Ανδρέας
Journal Title
Journal ISSN
Volume Title
Publisher
Abstract
In recent years, U.S. politics are characterized by an increasing polarization and partisan conflicts. In this study, we investigate the relationship between U.S. partisan conflict, as proxied by Partisan Conflict Index (PCI), with the returns and volatility of three asset classes, crude oil, gold and stock market. Using a rolling window regression model we tried to capture the nature of these relations and how they evolve over time, between March 1981 – May 2024. In general,
empirical findings suggest that both asset returns and volatility exhibit time-varying relationships with PCI. However, when focusing on findings with statistical significance, that time-varying relation only holds for crude oil returns and stock
market’s volatility. Gold’s and stock market’s returns maintain a positive relation while crude oil’s and gold’s volatility are negatively impacted by PCI. The study’s findings provide valuable insights for policymakers and investors and can navigate them with their decisions.
Description
Keywords
Partisan conflict, Crude oil, Gold, Stock market, Returns, Volatility, Regression