Trilemma of pandemic‑related health emergency, economic policy uncertainty and partisan confict in the United States: A time‑varying analysis evidence

Abstract

The events in the year 2020, especially the ravaging coronavirus (COVID19) pandemic has further exposed the vulnerability and connectedness associated with human health and the global economy. In the United States, amid the COVID-19 pandemic, the recent political polarization, especially the sharp divide between the Republican and Democrat party has further demonstrated the heightened partisan confict in the country. From this basis, the current study examines the time-varying Granger causality between pandemic-related health emergency, partisan confict, and economic policy uncertainty (EPU) in the United States over period January 1996 to June 2020. While there is an evidence of common time-varying Granger causality between August 2005 and September 2006 from pandemic-related health emergency to partisan, the evidence of Granger causality from partisan confict to pandemic is common in the period of January to May 2009. In addition, the Granger causality between partisan confict and EPU is obviously common between February and May 2020. As a policy concern, we are of the opinion that mechanism toward difusing the heightened political divide in the United States is essential and be pursued for the country’s economic and health sector challenges.