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2 edition of Monetary policy and oil price shocks found in the catalog.

Monetary policy and oil price shocks

Robert H. DeFina

Monetary policy and oil price shocks

empirical implications of alternative responses

by Robert H. DeFina

  • 229 Want to read
  • 34 Currently reading

Published by Federal Reserve Bank of Philadelphia, Economic Research Division in Philadelphia .
Written in English


Edition Notes

StatementRobert H. DeFina, Herbert E.Taylor.
SeriesEconomic research working paper series / Federal Reserve Bank of Philadelphia, Economic Research Division -- no.7, Economic research working paper (Federal Reserve Bank of Philadelphia, Economic Research Division) -- no.7.
ContributionsTaylor, Herbert E.
ID Numbers
Open LibraryOL13973918M

The impact of positive oil price shocks on inflation is weakened by monetary policy credibility. Evidence shows the influence of oil price on unit labour costs and correlation between exchange rate changes and inflation has weakened.   Moreover, the size of the endogenous "cost-push" shock generated by fluctuations in the oil price increases when oil is more difficult to substitute by other factors. JEL codes: D61, E Keywords: Optimal Monetary Policy, Welfare, Second Order Solution, Oil .

- The policy response of monetary and fiscal authorities These effects are not trivial: oil shocks have caused and/or contributed to each one of the US and global recessions of the last thirty years. Yet while recent recessions have all been linked to an increase in the price of File Size: 67KB. between asset prices and monetary policy from this point of view. Several chapters in the volume ask what monetary authorities can learn John Y. Campbell is Harvard College Professor and Morton L. and Carole S. Olshan Pro-fessor of Economics at Harvard University, and a research associate of the National Bureau of Economic Research. 1.

Get this from a library! Monetary policy and the oil market. [Naoyuki Yoshino; Farhad Taghizadeh-Hesary;] -- While oil price fluctuations in the past can be explained by pure supply factors, this book argues that it is monetary policy that plays a significant role in setting global oil prices. It is a key.   Bernanke, Ben, Mark Gertler, and Mark Watson. “Systematic Monetary Policy and the Effects of Oil Price Shocks.” Brookings Papers on Economic Activity, pp. Clarida, Richard, Jordi Gali, and Mark Gertler. “Monetary Policy Rules and Macroeconomic Stability: Evidence and Some Theory.” Quarterly Journal of Economics, pp.


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Monetary policy and oil price shocks by Robert H. DeFina Download PDF EPUB FB2

It can use expansionary monetary policy to try to offset the impact of oil prices on real output and employment. However, doing so will cause nominal GDP to grow faster. Systematic Monetary Policy and the Effiects of Oil Price Shocks THE PRINCIPAL OBJECTIVE of this paper is to increase our understanding of the role of monetary policy in postwar U.

business cycles. We take as our starting point two common findings in the recent monetary policy literature based on vector autoregressions (VARs).' First, identified. While oil price fluctuations in the past can be explained by pure supply factors, this book argues that it is monetary policy that plays a significant role in setting global oil prices.

It is a key factor often neglected in much of the earlier literature on the determinants of asset prices, including oil cturer: Springer. While oil price fluctuations in the past can be explained by pure supply factors, this book argues that it is monetary policy that plays a significant role in setting global oil prices.

This book presents a framework for modeling oil prices while incorporating monetary policy. It also provides a complete theoretical basis of the determinants of Cited by: 3.

1 1. Introduction There is a long tradition of associating U.S. recessions with oil price shocks on the one hand and with shocks to monetary policy or credit on the Size: KB. However, this book presents a framework for modeling oil prices while incorporating monetary policy.

It also provides a complete theoretical basis of the determinants of crude oil prices and the transmission channels of oil shocks to the economy. While oil price fluctuations in the past can be explained by pure supply factors, this book argues that it is monetary policy that plays a significant role in setting global oil prices.

Oil Price Shocks, Monetary Policy and Stagflation Lutz Kilian1 1. Introduction One of the central questions in recent macroeconomic history is to what extent monetary policy, as opposed to oil price shocks, contributed to the stagflation of the s.

Understanding what went wrong in the s is the key to learning from the past. sensitivity of the Czech economy and monetary policy to a potential oil price shock. Th is article is structured as follows. Section 2 describes the evolution of oil and oil product. that monetary policy does have real effects.

(The opposite is true for the unemployment rate, since higher rates of unemployment are associated with economic downturns.) For industrial production, Table 1 Dates of Monetary and Oil Price Shocks Money Oil Prices October December June September Comparison of the impulse responses indicate that endogenous monetary policy (to oil price shocks) contributes and percent of the contractionary effects of oil price shocks to real activity at the 2 and 3-year horizons, respectively, when a fiscal policy variable is included in the by: Moreover, various authors document the dynamic effects of policy shocks and report a gradual mean reversion of real stock prices and returns following the shock (e.g.

Lastrapes,Rapach,Neri, ). Such estimated reactions of the stock market to policy shocks are of potential interest for researchers in macro-finance for two by: monetary policy, rather than oil price per se, led to the contraction of the economy.

Which had a greater influence on gross domestic product (GDP) — oil price shocks or a change in monetary policy—has been debated for years.

One of the most prominent debates is between Bernanke et al. (), and Herrera and Hamilton (). Won Joong Kim & Shawkat Hammoudeh & Jun Seog Hyun & Rangan Gupta, "Oil Price Shocks and China’s Economy: Reactions of the Monetary Policy to Oil Price Shocks," Working PapersUniversity of Pretoria, Department of by: "Oil price volatility and the macroeconomy," Journal of Macroeconomics, Elsevier, vol.

18(1), pages Ben S. Bernanke & Mark Gertler & Mark Watson, "Systematic Monetary Policy and the Effects of Oil Price Shocks," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 28(1), pages Nature of Oil Price Shocks and Monetary Policy Junhee Lee, Joonhyuk Song.

NBER Working Paper No. Issued in September NBER Program(s):Monetary Economics We investigate the nature of oil price shocks to the Korean economy in recent years and find that the recent hike in oil price is induced by the increase in oil demand in contrast to the previous years when oil price run-up is mostly.

the impact of the price of crude oil on the prices of gasoline, heating oil, and electricity). While the first two conditions are necessary to introduce a microfounded monetary policy trade-off, they are not sufficient to explain the policymakers’ concern for the real activity consequences of oil price shocks.

Oil Price Shocks, Monetary Policy Rules and Welfare⁄ Fiorella De Fiorey Giovanni Lombardoz Viktors Stebunovsx July 5, (Work in progress) Abstract Sudden and protracted oil-price increases are generally accompanied by economic con-tractions and high in°ation.

How should monetary policy react to oil-price shocks in order. While oil price fluctuations in the past can be explained by pure supply factors, this book argues that it is monetary policy that plays a significant role in setting global oil prices.

It is a key factor often neglected in much of the earlier literature on the determinants of asset prices, including oil prices. A number of participants agreed that the nature of the oil price shock in the s was quite different from that which affected oil prices from to Lutz Kilian remarked that the general consensus is that the s oil price rise was due to a supply shock, which has.

Monetary Policy Report; Beige Book; Commodity Prices, the Economic Outlook, and Monetary Policy. Vice Chair Janet L. Yellen. These fairly modest and transitory effects of an oil price shock are also consistent with the response of the U.S.

economy to the dramatic run-up in commodity prices from to Indeed, while oil prices.Get this from a library! Nature of oil price shocks and monetary policy. [Junhee Lee; Joonhyuk Song; National Bureau of Economic Research.] -- We investigate the nature of oil price shocks to the Korean economy in recent years and find that the recent hike in oil price is induced by the increase in oil demand in contrast to the previous.

More on: Monetary Policy. Fossil Fuels. Economics. I wrote a week ago about an old paper by Bernanke, Gertler, and Watson (BGW) that attributed much .