Oil Price Implications for the Petroleum and Pharmaceutical Industry: the Quantile Regression Approach

Sanja Bakić

Prague Economic Papers, 2024, vol. 2024, issue 6, 709-730

Abstract: In the study, quantile regression (QR) is employed as the primary research tool, with ordinary least squares (OLS) regression used for comparison purposes. The motivation for this research stems from conflicting findings in existing literature regarding the spillover effects of Brent crude oil prices for the pharmaceutical industry. Findings from the QR analysis indicate that more substantial spillover effects occur in the tail quantiles, specifically during periods of economic crisis and prosperity. Recommendations for future research should focus on gaining a deeper understanding of the mechanisms underlying the differential responses of oil and pharmaceutical companies to oil price fluctuations, as well as identifying additional factors that may moderate these effects. In light of the study's findings, it is recommended to consider different regulatory approaches that could help reduce the sensitivity of oil companies to oil price oscillations. Additionally, support for business diversification strategies is advised to mitigate potential economic risks for both industries.

Keywords: oil shock spillover effect; oil and pharmaceutical industries; quantile regression (search for similar items in EconPapers)
JEL-codes: D00 E00 G01 (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
http://pep.vse.cz/doi/10.18267/j.pep.878.html (text/html)
http://pep.vse.cz/doi/10.18267/j.pep.878.pdf (application/pdf)
free of charge

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:prg:jnlpep:v:2024:y:2024:i:6:id:878:p:709-730

Ordering information: This journal article can be ordered from
Editorial office Prague Economic Papers, University of Economics, nám. W. Churchilla 4, 130 67 Praha 3, Czech Republic
http://pep.vse.cz

DOI: 10.18267/j.pep.878

Access Statistics for this article

Prague Economic Papers is currently edited by Klára Pavlová

More articles in Prague Economic Papers from Prague University of Economics and Business Contact information at EDIRC.
Bibliographic data for series maintained by Stanislav Vojir ().