The Impact of Economic Policy Uncertainty in the United States on Unemployment of Black and White Americans: Pre-pandemic Evidence

Abstract

This paper examines the impact of economic policy uncertainty in the United States on unemployment of black and white Americans before the COVID-19 pandemic/recession. Our evidence shows that a positive economic policy uncertainty shock leads to an increase in the unemployment rate for members of both racial groups, which is in line with our expectations. However, our evidence also shows that economic political uncertainty in the United States is affecting the unemployment rate of black Americans faster and more strongly.