Download or read book Exchange Rates of Oil Exporting Countries and Global Oil Price Shocks written by Alfred A. Haug and published by . This book was released on 2017 with total page 32 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper considers logistic (asymmetric) and exponential (symmetric) smooth transition adjustments of real and nominal exchange rates for six major oil-exporting countries in response to different shocks affecting oil prices. Real exchange rate movements affect the terms of trade and hence may affect relative competitiveness. We detect no statistically significant non-linearities for the adjustment process of real exchange rate returns, be they asymmetric or symmetric, in response to oil supply shocks, idiosyncratic oil-market-specific shocks, and speculative (crude oil inventory) oil-market shocks. On the other hand, global aggregate demand shocks, which are shocks that do not directly originate in the oil market, have nonlinear asymmetric effects on real exchange rate returns for Canada, Mexico, Norway and Russia, and linear effects for the UK. These qualitative results mostly hold for nominal exchange rate returns as well. Exceptions are that linear effects are found for aggregate demand shocks for Brazil and for idiosyncratic shocks for Norway, whereas the aggregate demand shocks for the UK have nonlinear and asymmetric effects instead of linear ones.
Download or read book Oil and the International Economy written by Georg Koopmann and published by Transaction Publishers. This book was released on with total page 456 pages. Available in PDF, EPUB and Kindle. Book excerpt: The oil price increases of the 1970s left deep marks on the world economy. They led to a massive redistribution of income in favor of oil-producing countries, and caused serious disruption of growth, imbalances in foreign trade, and problems of stability in oil-importing countries. Despite the present levelling off, the authors suggest that more price increases remain a distinct possibility. "Oil and the International Economy "examines the effects of rising oil prices on the international financial system and identifies ways that oil-importing countries can overcome the financial and adjustment problems caused by them. The authors project the long-term trend in real oil prices and present economic policy options to help avoid future financial problems for industrialized and developing nations alike. Contents: The World Oil Market after the Oil Price Shocks; Future Trends in the Demand for Oil; Future Trends in the Supply of Oil; Balance-of-Payments and Exchange-Rate Adjustment: Current Account Developments in Times of Rising Oil Prices and Effects on Exchange Rates; The Effects of Real Oil Price Increases on Energy and Raw Material Prices; Repercussions on the General Price Level; Implications for the German Monetary and Exchange Rate Policy; Are Real Oil Price Increases a Brake on Growth?; Options for Economic Policy; The Struggle for Markets in the Oil-Producing Countries; The Oil-Producing Countries as Competitors in the Manufacturing Sector; Consequences for Trade Between Oil-Importing Countries.
Download or read book Oil Price Shocks and Exchange Rate Movements written by Nikanor Volkov and published by . This book was released on 2015 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study investigates the effects of oil price shocks on exchange rate movements in five major oil-exporting countries: Russia, Brazil, Mexico, Canada, and Norway. The R2 for the model doubles in Russia and Brazil, but increases slightly in Canada and Norway when oil prices are added to it. The volatility of exchange rates associated with oil price shocks is significant in Russia, Brazil, and Mexico, but weak in Norway and Canada. It takes much longer for the exchange rate to reach the initial equilibrium level in Russia, Brazil, and Mexico than in Norway and Canada. The asymmetric behavior of exchange rate volatility among countries seems to be related to the efficiency of financial markets rather than to the importance of oil revenues.
Download or read book Oil and the International Economy written by Georg Koopmann and published by Routledge. This book was released on 2022-01-26 with total page 222 pages. Available in PDF, EPUB and Kindle. Book excerpt: The oil price increases of the 1970s left deep marks on the world economy. They led to a massive redistribution of income in favor of oil-producing countries, and caused serious disruption of growth, imbalances in foreign trade, and problems of stability in oil-importing countries. Despite the present levelling off, the authors suggest that more price increases remain a distinct possibility.Oil and the International Economy examines the effects of rising oil prices on the international financial system and identifies ways that oil-importing countries can overcome the financial and adjustment problems caused by them. The authors project the long-term trend in real oil prices and present economic policy options to help avoid future financial problems for industrialized and developing nations alike.
Download or read book A Crude Shock written by Francesco Grigoli and published by International Monetary Fund. This book was released on 2017-07-18 with total page 26 pages. Available in PDF, EPUB and Kindle. Book excerpt: The decline in oil prices in 2014-16 was one of the sharpest in history, and put to test the resilience of oil exporters. We examine the degree to which economic fundamentals entering the oil price decline explain the impact on economic growth across oil exporting economies, and derive policy implications as to what factors help to mitigate the negative effects. We find that pre-existing fundamentals account for about half of the cross-country variation in the impact of the shock. Oil exporters that weathered the shock better tended to have a stronger fiscal position, higher foreign currency liquidity buffers, a more diversified export base, a history of price stability, and a more flexible exchange rate regime. Within this group of countries, the impact of the shock is not found to be related to the size of oil exports, or the share of oil in fiscal revenue or economic activity.
Download or read book Macroeconomic Effects of Terms of trade Shocks written by Nikola Spatafora and published by World Bank Publications. This book was released on 1999 with total page 42 pages. Available in PDF, EPUB and Kindle. Book excerpt: January 1995 The authors investigate the impact on economic growth and development of long-run movements in the external terms of trade, with special reference to the experience of 18 oil-exporting countries between 1973 and 1989. They argue that this sample approximates a controlled experiment for examining the impact of unanticipated -- but permanent -- shocks to the terms of trade. They analyze the sample econometrically using panel data techniques. They find that permanent terms-of-trade shocks have a strongly significant positive effect on investment, which they justify theoretically on the grounds that countries in the sample import much of their capital equipment. The shocks also have a significant positive effect on consumption. Government consumption responds almost twice as strongly as private consumption. The shocks have no effect on savings and adversely affect the trade and current account balances. There is a significant positive effect on the output of all main categories of nontradables. But Dutch disease effects are strikingly absent. Agriculture and manufacturing do not contract in reaction to an oil price increase. Dutch disease effects may be absent in part because of policy-induced output restraints in the oil sector, or because of the enclave nature of the oil sector, which does not participate in domestic factor markets.
Download or read book The Third Oil Shock Routledge Revivals written by Joan Pearce and published by Routledge. This book was released on 2018-10-24 with total page 120 pages. Available in PDF, EPUB and Kindle. Book excerpt: First published in 1983, this book a number of collects the essays about the effects of a sustained period of low oil prices. The opening chapter describes how oil prices have impinged on other elements of the economy and assesses the costs and benefits, in the short and long term, of low prices. The following three chapters deal with different groups of countries and indicate clearly that for none of them do lower oil prices have unequivocally positive or negative effects — a situation examined in the chapter on the international financial system. The last three chapters analyse the shifts lower prices are likely to produce in relations among the groups closely involved in the oil market.
Download or read book Oil Price Shocks and Economic Growth in Oil Exporting Countries written by Amir Sadeghi and published by International Monetary Fund. This book was released on 2017-12-22 with total page 27 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the impact of government size on how output and government expenditure respond to oil price shocks in 28 oil-exporting countries between 1990 and 2016. Results suggest that if the size of government (measured by government expenditure-to-(non-oil) GDP ratio) is larger, non-oil output growth, in response to a positive oil price shock, tends to be greater and output volatility higher. Furthermore, I find that an unexpected increase in oil price leads to expansion in government expenditure and the expansion is larger, the larger is the government. This paper provides empirical evidence for direct correlation between government size and macroecnomic stability in oil-exporting countries. The findings imply that fiscal consolidation and economic diversification help to narrow down economic exposure to exogenous oil price shocks and reduce volatility in non-oil output.
Download or read book Exchange Rate Assessments written by Mr.Irineu E. de Carvalho Filho and published by International Monetary Fund. This book was released on 2009-12-01 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt: Are the current account fluctuations in oil-exporting countries "excessive"? How should their real exchange rate respond to the evolution of external (and domestic) fundamentals? This paper proposes methodologies tailored to the specific features of oil-exporting countries that help address these questions. Price-based methodologies (based on the time series of real effective exchange rates) identify a strong link between the real exchange rate and the terms of trade, but have relatively limited explanatory power. On the other hand, an empirical model of the current account, which fits oil exporting countries' data well, and an intertemporal model that takes into account the stock of oil reserves provide useful benchmarks for oil exporters' external balances.
Download or read book The impact of oil price dynamics on global economy written by Vivian Randhawa and published by GRIN Verlag. This book was released on 2018-05-14 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt: Seminar paper from the year 2014 in the subject Business economics - Trade and Distribution, grade: 1,7, Hamburg University of Applied Sciences, language: English, abstract: After oil was discovered in the late 19th century, oil prices were primarily determined first by the major petroleum companies and then by the oil-exporting nations, who joined forces in the Organization of Petroleum Exporting Countries (OPEC). In the 1960s, the market-oriented pricing system was adopted and since then oil prices are primarily formed by supply and demand. Oil prices are characterized by permanent price fluctuations. Especially rapid price rises and longer-term fluctuations are at the focus of many scientific work. Because oil is an indispensable resource for the global economy, the question arises after the economic impacts of such price developments. While oil- exporting countries benefit from strong price rises, oil- importing countries, with emerging countries leading the way, are negatively affected. The interplay of these opposite effects and the global economic situation are crucial for the net effect on global economy.
Download or read book Global Impacts of Oil Price Shocks written by Saeed Moshiri and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Oil price shocks impact the global economy, but the effects are not alike across the countries. While higher oil prices are beneficial to oil-exporting countries, they are harmful to economic performance of oil-importing countries. The opposite is also true for the lower oil prices. Nonetheless, international trade may mitigate the direct impacts of oil price shocks on both groups of countries. While the literature on the direct impact of oil price shocks on either oil-exporting or oil-importing countries is rich, the studies on the indirect impacts are limited. In this paper, we set up an empirical model to estimate the direct and indirect effects of oil price shocks on 30 major net oil-exporting and net oil-importing countries that comprise more than 73 percent of the world's economy. We use bilateral trade matrix to construct the spillover variables and estimate the indirect impact of oil price chocks. To control for institutional variations across the countries, we divide each group of the oil-exporting and oil-importing countries into two developed and developing groups. The estimation results for the period 1980-2015 show that all oil-importing countries are adversely affected by rising oil prices, but trade has mitigated the effect in developed countries. The impact of positive oil price shocks on developing oil-exporting countries is positive, but the trade has reduced the effect. However, the effect of the shocks on developed oil-exporting countries is not significant.
Download or read book The Differential Effects of Oil Demand and Supply Shocks on the Global Economy written by Mr.Paul Cashin and published by International Monetary Fund. This book was released on 2012-10-23 with total page 41 pages. Available in PDF, EPUB and Kindle. Book excerpt: We employ a set of sign restrictions on the generalized impulse responses of a Global VAR model, estimated for 38 countries/regions over the period 1979Q2–2011Q2, to discriminate between supply-driven and demand-driven oil-price shocks and to study the time profile of their macroeconomic effects for different countries. The results indicate that the economic consequences of a supply-driven oil-price shock are very different from those of an oil-demand shock driven by global economic activity, and vary for oil-importing countries compared to energy exporters. While oil importers typically face a long-lived fall in economic activity in response to a supply-driven surge in oil prices, the impact is positive for energy-exporting countries that possess large proven oil/gas reserves. However, in response to an oil-demand disturbance, almost all countries in our sample experience long-run inflationary pressures and a short-run increase in real output.
Download or read book Oil Price Uncertainty written by Apostolos Serletis and published by World Scientific Publishing Company Incorporated. This book was released on 2012 with total page 142 pages. Available in PDF, EPUB and Kindle. Book excerpt: The relationship between the price of oil and the level of economic activity is a fundamental issue in macroeconomics. There is an ongoing debate in the literature about whether positive oil price shocks cause recessions in the United States (and other oil-importing countries), and although there exists a vast empirical literature that investigates the effects of oil price shocks, there are relatively few studies that investigate the direct effects of uncertainty about oil prices on the real economy. The book uses recent advances in macroeconomics and financial economics to investigate the effects of oil price shocks and uncertainty about the price of oil on the level of economic activity.
Download or read book International Dimensions of Monetary Policy written by Jordi Galí and published by University of Chicago Press. This book was released on 2010-03-15 with total page 663 pages. Available in PDF, EPUB and Kindle. Book excerpt: United States monetary policy has traditionally been modeled under the assumption that the domestic economy is immune to international factors and exogenous shocks. Such an assumption is increasingly unrealistic in the age of integrated capital markets, tightened links between national economies, and reduced trading costs. International Dimensions of Monetary Policy brings together fresh research to address the repercussions of the continuing evolution toward globalization for the conduct of monetary policy. In this comprehensive book, the authors examine the real and potential effects of increased openness and exposure to international economic dynamics from a variety of perspectives. Their findings reveal that central banks continue to influence decisively domestic economic outcomes—even inflation—suggesting that international factors may have a limited role in national performance. International Dimensions of Monetary Policy will lead the way in analyzing monetary policy measures in complex economies.
Download or read book Oil Price Developments Drivers Economic Consequences and Policy Responses written by Nadine Pahl and published by GRIN Verlag. This book was released on 2009-04-16 with total page 85 pages. Available in PDF, EPUB and Kindle. Book excerpt: Research Paper (undergraduate) from the year 2007 in the subject Business economics - Economic Policy, grade: 1,0, University of Applied Sciences Berlin, course: General Economics, language: English, abstract: Oil prices are an important determinant of global economic performance. Crude Oil prices ranged between $2.50/bbl and $3.00/bbl from 1948 through the end of the 1960s. As of this day, the price for crude oil is $89.82/bbl. In general, spikes in oil prices are not unusual and are, to some extent, symptomatic of a gradual upward trend in daily oil price volatility. Volatile prices arise from supply and demand that are both highly inelastic in the short run, with the result that even small shocks can have large effects on price. But especially within the last few years, the oil price has continuously increased sharply - and to some extent unexpected. This recent sharp increase in the oil price prompts several questions: Why have oil prices risen? What is the impact on the global economy and on individual countries? How do oil importing countries cope with the higher prices? What are appropriate policy responses to stabilise the economy in face of high oil prices? And last but not least, what role does the Organisation of Petroleum Exporting Countries really play? To begin with, there is no doubt that the recent increase in oil price is mainly demand driven, combined with historically low excess capacity and heightened concerns about supply disruptions. And even without macroeconomic knowledge, everyone is aware that higher oil prices affect the economy as a whole and all its market participants. In the following, this paper analyses in detail the current main oil price drivers, their economic consequences and the possible policy responses - always framed by the volatility and uncertainty that characterise the oil market.
Download or read book Oil Price Developments Drivers Economic Consequences and Policy Responses written by Nadine Pahl and published by GRIN Verlag. This book was released on 2009-03-27 with total page 78 pages. Available in PDF, EPUB and Kindle. Book excerpt: Research Paper (undergraduate) from the year 2007 in the subject Business economics - Economic Policy, grade: 1,0, University of Applied Sciences Berlin, course: General Economics, language: English, abstract: Oil prices are an important determinant of global economic performance. Crude Oil prices ranged between $2.50/bbl and $3.00/bbl from 1948 through the end of the 1960s. As of this day, the price for crude oil is $89.82/bbl. In general, spikes in oil prices are not unusual and are, to some extent, symptomatic of a gradual upward trend in daily oil price volatility. Volatile prices arise from supply and demand that are both highly inelastic in the short run, with the result that even small shocks can have large effects on price. But especially within the last few years, the oil price has continuously increased sharply – and to some extent unexpected. This recent sharp increase in the oil price prompts several questions: Why have oil prices risen? What is the impact on the global economy and on individual countries? How do oil importing countries cope with the higher prices? What are appropriate policy responses to stabilise the economy in face of high oil prices? And last but not least, what role does the Organisation of Petroleum Exporting Countries really play? To begin with, there is no doubt that the recent increase in oil price is mainly demand driven, combined with historically low excess capacity and heightened concerns about supply disruptions. And even without macroeconomic knowledge, everyone is aware that higher oil prices affect the economy as a whole and all its market participants. In the following, this paper analyses in detail the current main oil price drivers, their economic consequences and the possible policy responses - always framed by the volatility and uncertainty that characterise the oil market.
Download or read book Asymmetric Effects of Oil Price Shocks on Economic Growth of Oil Exporting Countries written by Saeed Moshiri and published by . This book was released on 2012 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Oil price shocks affect macroeconomic performance in both oil-importing and oil-exporting countries. The recent research on the oil-macroeconomy relationship in the oil-importing countries shows that oil price shocks have asymmetric effects on their economic growth; the adverse effects of higher oil prices are larger than the stimulating effects of lower prices. The effects of oil price shocks on economic performance and their transmission mechanism in oil-exporting countries are different than those in oil-importing countries. In this study, we examine the oil-macroeconomy nexus in the context of oil-exporting developing countries. We set up a VAR model with a GARCH-type oil price shocks to estimate and test the asymmetric effects of oil shocks in six major oil exporting members of OPEC for the period 1970-2009. The model includes oil price shocks and economic growth as two major variables of interest as well as the intermediate variables such as investment, exchange rate, and inflation rate. We find that in oil exporting developing countries, lower oil prices would lead to major revenue cuts and stagnation in the economy. However, higher oil prices and accompanying higher revenues do not translate to a sustained economic growth.
