What Can Stockouts Tell Us About Inflation? Evidence from Online Micro Data

Alberto Cavallo and Oleksiy Kryvtsov

No 29209, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We use a detailed micro dataset on product availability to construct a direct high-frequency measure of consumer product shortages during the 2020–2021 pandemic. We document a widespread multi-fold rise in shortages in nearly all sectors early in the pandemic. Over time, the composition of shortages evolved from many temporary stockouts to mostly discontinued products, concentrated in fewer sectors. We show that unexpected product shortages have significant inflationary effects within three months. We develop a model of inventories in a sector facing both demand and cost disturbances, and use the observed joint dynamics of stockouts and prices to show that these effects can be associated with elevated cost of replenishing inventories.

JEL-codes: D22 E31 E37 (search for similar items in EconPapers)
Date: 2021-09
New Economics Papers: this item is included in nep-isf, nep-mac and nep-mon
Note: IFM IO ME
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Citations: View citations in EconPapers (15)

Published as Alberto Cavallo & Oleksiy Kryvtsov, 2023. "What can stockouts tell us about inflation? Evidence from online micro data," Journal of International Economics, .
Published as What Can Stockouts Tell Us About Inflation? Evidence from Online Micro Data , Alberto Cavallo, Oleksiy Kryvtsov. in NBER International Seminar on Macroeconomics 2022 , Forbes, Gourinchas, and Reis. 2023

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Working Paper: What Can Stockouts Tell Us About Inflation? Evidence from Online Micro Data (2021)
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