RT Generic
T1 The asymmetry puzzle: the supply chain disruptions news shocks effects on oil prices and inflation
A1 Puch González, Luis Antonio
A1 Guinea, Laurentiu
A1 Ruiz, Jesús
A2 Universidad Carlos III de Madrid. Departamento de Economía, 
AB This paper investigates the asymmetrical effects of supply chain disruptions on oil prices and inflation. To this purpose, we identify anticipated (news) shocks associated to the global supply chain. Then we estimate the effects of these shocks on oil prices and inflation in the US. We allow 'escalating' (restrictive) and 'deescalating' (expansionary) supply chain news shocks tohave differing effect sizes. Our empirical findings reveal that anticipated supply chain disruptions exert a substantial and statistically significant influence on both oil prices and inflation. We uncover a significant asymmetry in these effects: 'escalating news' shocks exhibit a markedly stronger and more persistent impact compared to 'deescalating news' shocks. Consequently, the oil price is less sensitive to an alleviation of supply chain strain than to an exacerbation. Our results can be rationalized by a small open economy model which is used to assess the validity of our empirical approach. Furthermore, we demonstrate that the mechanisms governing thetransmission of supply chain news shocks in the model align closely with observed empirical patterns. Failing to account for this asymmetry could lead to misjudgments regarding the repercussions of supply chain pressures.
SN 2340-5031
YR 2024
FD 2024-02-29
LK https://hdl.handle.net/10016/43758
UL https://hdl.handle.net/10016/43758
LA eng
NO We thank the Spanish Ministerio de Economía y Competitividad (grants PID2019-107161GB-C32 and TED2021- 129891B-I00, financed by MCIN/AEI/10.13039/501100011033 and the European Union NextGenerationEU/PRTR) for financial support.
DS e-Archivo
RD 21 may. 2024