Uncertain Times in Lebanon: How Policy Shocks Ripple through MENA Markets

altug, sumru and barakat, majdy and Dagher, Leila and uluceviz, erhan (2025): Uncertain Times in Lebanon: How Policy Shocks Ripple through MENA Markets.

Abstract

Despite its small size, Lebanon’s chronic crises send financial shockwaves across the Middle East and North Africa. This column uses a Twitter-based index of economic policy uncertainty to track Lebanon’s instability and shows that it transmits financial shocks to seven MENA economies, with spillovers are strongest for Egypt, Jordan, and smaller Gulf states. Real-time policy uncertainty signals can help regional policymakers and investors manage risk and improve financial resilience.

• Item Type: MPRA Paper
• Language: English
• Keywords: lebanon; economic policy uncertainty; connectedness; twitter-based index
• Subjects: C - Mathematical and Quantitative Methods > C4 - Econometric and Statistical Methods: Special Topics; E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy

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