Tariff Shadows: Mapping Higher-Order Moment Spillovers Across Global Equity Markets

This paper examines how risk spreads among G7 and BRICS stock markets, focusing not only on volatility but also on higher-order statistical moments (skewness and kurtosis). We analyze how Trump's reciprocal tariff policies affected global market connections. Using a comprehensive spillover framework, we find that different types of risk behave differently across markets. For volatility spillovers, Germany is the main source while China and Japan receive the most risk. For higher-moment risks, the U.S. and Canada spread the highest risk, with Japan and India being the primary receivers. After Trump implemented reciprocal tariffs, risk transmission across global stock markets increased sharply. Volatility spillovers showed the largest increase, but higher-moment risk transmission also rose significantly, indicating that extreme market events became more interconnected globally.