Unexpected economic growth and oil price shocks

Wang, Fangzhi; Liao, Hua

doi:10.1016/j.eneco.2022.106430

Cited by 14 publications

(6 citation statements)

References 40 publications

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“…The results from the growth‐to‐commodity causality context suggest that the predictive power of economic growth for commodity prices is relatively weak, especially for developed economies. This finding adds to the study by Wang and Liao (2022) who find mixed results for the economic growth impact on commodities, and in particular oil, with respect to four nations, China, India, Japan and the US. From policy perspective, our findings suggest that although economic growth is often seen as a driven for demand in commodity markets, for countries where demand‐led growth exceeds productivity growth, the forecasting power of economic growth for future commodity prices is relatively weaker.…”

Section: Resultssupporting

confidence: 69%

“…Second, a large body of the existing literature is devoted to study the impact of oil prices on economic growth (for example, Narayan et al, 2014; Sharma et al, 2019; Wang & Liao, 2022), however, not all commodity‐dependent countries are reliant on oil (see, Deaton & Miller, 1995; Cashin et al, 2004, for discussion). During the last 20 years, the proportion of energy‐dependent countries remain almost unchanged of about a third of all commodity‐dependent economies, whereas the percentage of mineral‐dependent countries doubled to a third and, last but not least, the proportion of economies dependent on agricultural commodities declines by almost a quarter to slightly above thirty percent of all commodity‐dependent countries (UNCTAD, 2021).…”

Section: Introductionmentioning

confidence: 99%

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The predictive power of commodity prices for future economic growth: Evaluating the role of economic development

Enilov

2023

Int. J Fin Econ

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This paper investigates the extent to which commodity prices can predict economic growth, the growth exposure of the countries to specific commodity group, and whether the country stage of development matters for growth dependency on commodities. We use a novel time‐varying mixed‐frequency vector autoregressive model to jointly estimate causality between monthly commodity prices and quarterly economic growth for the period from January 1980 to March 2020. Our findings suggest that growth dependency on commodities varies over time and across different synthetic measures, but in general solid evidence of predictability is determined. The overall commodity index shows better performance in predicting economic growth than the segregated proxies of either fuel or non‐fuel commodities in developed economies. However, the overall commodity index is as effective as the fuel index in predicting economic growth for their developing counterparts. We develop a new index of global commodity growth connectivity (GCGCI) to determine the economic growth dependency on commodities over time. Our results show that economic growth dependency on commodities has increased at least three times with financialization of commodity markets. The GCGCI for all commodities reveals a higher growth dependency on commodities in developing countries than developed ones in the post‐financialization period. Interestingly, we find that growth decreases its reliance on fuel commodities in both developed and developing countries after financialization of commodity markets. Our findings bear implications for policymakers to design stabilization policies in an attempt to protect economies vulnerable to commodity price shocks and lay the foundation for sustainable economic growth.

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Section: Resultssupporting

confidence: 69%

Section: Introductionmentioning

confidence: 99%

The predictive power of commodity prices for future economic growth: Evaluating the role of economic development

Enilov

2023

Int. J Fin Econ

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“…Furthermore, the stability of the energy market is also significantly influenced by expectations regarding the trend in the evolution of energy supply and demand. These expectations are projected onto the overall sentiment of global investors and their trading decisions, subsequently impacting the current levels of energy inventories and prices (Balcilar et al, 2018; Bouoiyour et al, 2019; Kilian and Murphy, 2014; Su et al, 2019; Wang and Liao, 2022). Among them, changes in supply and demand expectations exert a more immediate influence, whereas modifications in actual supply and demand exert a longer-term impact on energy prices.…”

Section: Literature Reviewmentioning

confidence: 99%

Spillover effects of geopolitical risks on global energy markets: Evidence from CoVaR and CAViaR-EGARCH model

Zhao,

Chen,

Zhang

2023

Energy Exploration & Exploitation

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This study investigated the spillover effects of geopolitical risks on energy (crude oil, coal and natural gas) markets. The empirical evidence is based on the CoVaR index and the CAViaR-EGARCH model. Results demonstrate that the spillover effects of geopolitical risks on the global energy market are nonlinear, asymmetric and time-varying. With each 1% rise in global geopolitical risks, the left tail risks in the crude oil, coal, and natural gas markets decreased by 0.179%, 0.119% and 0.113%, while the right tail risks increased by 0.144%, 0.135% and 0.097%, respectively. In addition, the magnitude of energy crises triggered by different geopolitical events varies. Lastly, the spillover effects of GPR on energy markets vary considerably across nations, with more substantial effects observed on average in BRICS than in G7 countries. The primary implication is to provide references for government and energy investors to avoid energy market risks timely.

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“…El comercio internacional se explica a través del desarrollo de las economías y el énfasis en surgir y prosperar a nivel comercial [21]. Los primeros teóricos pensaban que los flujos comerciales deben de coincidir entre las necesidades a fines de los países, de lo contrario no habría un equilibro entre su oferta y demanda, además podría surgir en los países la idea de proteger sus fronteras e imponer diversas acciones en contra de productos externos [22], tales como barreras arancelarias, cuotas de importación e inclusive sanciones o multas [23].…”

Section: El Comercio Internacionalunclassified

Diversification of Peruvian Ginger exports 2012 – 2021

Montes Ninaquispe,

Pantaleón Santa María,

Arbulú Ballesteros

et al. 2023

Proceedings of the 21th LACCEI International Multi-Conference for Engineering, Education and Technology (LACCEI 2023): “Leaders

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In the last decade, an increase in ginger exports was developed in the different markets of the world, with the present investigation it was desired to determine the level of Peruvian exports of this product through the analysis of the diversification of markets and exporting companies during From 2012 to 2021, the research was quantitative, non-experimental, cross-sectional, basic and descriptive, using a review guide as an instrument that collected the data registered on the SUNAT customs web portal of ginger exporting companies under the national subheading 0910110000 ( Ginger without crushing or pulverizing) in a period of 10 years starting from 2012, for the calculation of diversification an indicator known as the Herfindahl-Hirschman index (IHH) was used. Among the most relevant results, it is concluded that it was found that there was an increase in the diversification of exporting companies, reaching 2021 with 140 ginger exporting companies, going from an index of 4036 in 2012 to 334 in 2021.Regarding the market found that there was an increase in the diversification of exporting companies, going from an index of 3,286 in 2012 to 2,525 in 2021, which indicated that the markets are not diversified, with the main destination markets being the United States, the Netherlands and Spain, which comprised 84% of the total.

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Unexpected economic growth and oil price shocks

Cited by 14 publications

References 40 publications

The predictive power of commodity prices for future economic growth: Evaluating the role of economic development

The predictive power of commodity prices for future economic growth: Evaluating the role of economic development

Spillover effects of geopolitical risks on global energy markets: Evidence from CoVaR and CAViaR-EGARCH model

Diversification of Peruvian Ginger exports 2012 – 2021

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