US Government Shutdown: A Toxic Affair


The US government has been shut down after Congress failed to reach an agreement on the budget, amid squabbling on immigration. The closure of non-essential federal offices could cost 0.1-0.15 ppt in annualized GDP growth each week. The US Partisan Conflict Index reached a record high in 2017. According to the IMF there is a relation between political fragmentation and public debt.