Macroeconomic Effects from Media Coverage of the China-U.S. Trade War on selected EU Countries

Beckmann, Joscha and Czudaj, Robert L. and Murach, Michael (2024): Macroeconomic Effects from Media Coverage of the China-U.S. Trade War on selected EU Countries.

Abstract

The objective of this paper is to analyze the macroeconomic effects of media coverage related to the trade conflict between China and the U.S. for selected countries of the European Union. Our main aim is to evaluate whether media coverage constitutes a relevant transmission channel for macroeconomic effects. We evaluate the response of survey-based macroeconomic expectations, stock prices, and realized industrial production. Our analysis focuses on Germany, France, Italy, and Spain in order to allow for heterogeneous effects across major EU countries. We find significant effects on expectations, stock prices, and industrial production. Especially, a significantly negative effect on current account expectations is observed for three of the four considered EU countries (Germany, Italy, and Spain).

• Item Type: MPRA Paper
• Language: English
• Keywords: China, Current account, EU, Expectations, Trade war
• Subjects: F - International Economics > F3 - International Finance > F32 - Current Account Adjustment ; Short-Term Capital Movements; F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F41 - Open Economy Macroeconomics; F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F43 - Economic Growth of Open Economies

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