Truly honored to present my CAMA working paper on the consequences of geopolitical turning points on macroeconomic volatility during a research webinar at the Central Bank of Malta on Thursday 10 September 2026. I am extremely grateful to Umberto Collodel for the invitation. Stay tuned for more information.
Geopolitical Turning Points and Macroeconomic Volatility: A Bilateral Identification Strategy
This paper constructs a new identification method to quantify bilateral geopolitical shocks—geopolitical turning points—i.e., abrupt, unforeseen state-to-state political turning points. Geopolitical shocks are captured by the second difference of the Political Relationship Index (Δ²PRI), a monthly narrative-based index constructed from Chinese government and media coverage. Unlike conventional global geopolitical risk indicators, Δ²PRI separates sudden departures from bilateral diplomatic paths so causal estimation is possible in a comparative cross-national context. Quantile instrumental variable local projections (IV-LP) are applied in the paper to estimate the dynamic and asymmetric geopolitical shock impact on world oil prices. It is estimated that US–China relational improvements lower oil prices by 0.2% in the short run and increase them by 0.3% in the medium run, with larger effects at the distribution boundaries of oil prices. Replication from Japan–China data establishes external validity. The paper adds a replicable analysis framework to explain how geopolitical shocks for dyads with heterogeneous institutional history and strategic rivalry spill over into global economic instability.
My research has been presented in several central bank settings over the recent period, reflecting sustained engagement with policy-relevant empirical work: at the Bank of Thailand in May 2024 (during the ABD-PIER conference), the Bank of France in October 2024 (during a visiting scholar appointment), the European Central Bank in November 2024 (ECB research seminar of the Euro Area External Sector and Euro Adoption Division in the Directorate General Economics), the Bank of Finland in April 2025 (BOFIT research seminar during a visiting scholar appointment), the Bank of Korea in August 2025 (during the ABD-JIMF-BOK conference and a research seminar), the Bank of Israel (during the VIMM webinar) in September 2025, the Bank of Latvia in October 2025 (research seminar), the National Bank of Slovakia in January 2026 (research seminar), the Bank of England in January 2026 (research seminar), the Central Bank of the Republic of Türkiye in February 2026 (research webinar), the Central Bank of Suriname in February 2026 (research “hands-on” webinar), the Bank Al-Maghrib in March 2026 (research webinar), and the South African Central Bank in April 2026 (research webinar).