Updated June 1, 2022
We compile the Economic Policy Uncertainty Index for Hong Kong following the methods in “Measuring Economic Policy Uncertainty” by Scott Baker, Nick Bloom and Steven J. Davis. Our index starts in April 1998 and runs through the present.
We construct our index using ten Hong Kong newspapers: Wen Wei Po, Sing Pao, Ming Pao, Oriental Daily, Hong Kong Economic Journal, Sing Tao Daily, Hong Kong Economic Times, Apple Daily, Hong Kong Commercial Daily, and Ta Kung Pao. The newspaper articles are available in the Wisers Information Portal from April 1998 onwards. For each newspaper and month, we count articles that contain the traditional Chinese language equivalent of one or more terms in each of the following term sets:
Since Hong Kong newspapers typically have extensive China and international news sections, criterion (1) serves to remove uncertainty not directly related to Hong Kong.
We scale the monthly count of articles that meet criteria (1)-(4) above by the count of articles in the same newspaper and month that meet criteria (1) and (2), yielding a monthly scaled EPU count for each newspaper. We then standardize each newspaper’s scaled EPU count to unit standard deviation from April 1998 to December 2009. Using the standardized, scaled EPU frequency counts, we average across the ten papers by month to obtain our EPU index. In a final step, we multiplicatively rescale the index to a mean of 100 from April 1998 to December 2009.
We thank Steve Davis for helpful comments on a preliminary version of our EPU index for Hong Kong. For additional discussion and an analysis that uses our Hong Kong EPU index, see Luk, P., M. Cheng, P. Ng and K. Wong (2018) “Economic Policy Uncertainty Spillovers in Small Open Economies: the Case of Hong Kong.” Pacific Economic Review.