The effect of economic policy uncertainty on the nexus between economic openness and economic growth: Evidence from Vietnam


Authors

  • Pham Xuan Bach Dai Nam University
  • Phan The Cong Thuongmai University
DOI: https://doi.org/10.57110/vnu-jeb.v5i5.479

Keywords:

Economic policy uncertainty, trade openness, FDI, economic growth

Abstract

Economic integration is an inevitable trend and can be seen as a critical path toward the growth and development of countries, especially developing countries. However, the large extent of openness in these economies also raises concerns about the effect when economic volatility occurs. This paper investigates the effect of economic policy uncertainty on the nexus between economic openness and economic growth in Viet Nam by applying the ARDL and FMOLS method in the 1996-2022 data. The results show that economic policy uncertainty could hinder the positive effect of investment flows on economic growth, but conversely, it limits the negative impact of trade openness on growth. However, this result does not admit that economic policy uncertainty could have positive effects on growth but raises critical concerns as Vietnam's trade balance has improved and has maintained a continuous trade surplus in recent years. Thus, several implications have been proposed.

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25-10-2025

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Pham Xuan Bach, & Phan The Cong. (2025). The effect of economic policy uncertainty on the nexus between economic openness and economic growth: Evidence from Vietnam. VNU JOURNAL OF ECONOMICS AND BUSINESS, 5(5), 39. https://doi.org/10.57110/vnu-jeb.v5i5.479

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Vol. 5 No. 5

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Original Article

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