The spillover effects of rising energy prices following 2022 Russian invasion of Ukraine

Michiyuki Yagi and Shunsuke Managi

Economic Analysis and Policy, 2023, vol. 77, issue C, 680-695

Abstract: This study examines how the rise in energy prices following the Russian invasion of Ukraine (which began on February 24, 2022) has spread to other sectors using the monthly input–output model (56 sectors in 44 countries). The estimated results demonstrate that if prices increase by 20% exclusively in Russia’s mining and quarrying (M&Q) sector, there will be almost no global effect. However, if prices increase by 20% in every M&Q sector around the world, global prices (the weighted average across all sectors) will rise by 3.15%, damaging 6.83% of monthly GDP at the pre-invasion level as a surplus loss ($551,080 million per month). Because oil prices rose for almost five months from February 28 to August 3, 2022, the world suffered five times this damage, or 2.85% of annual GDP ($2.7 trillion). This scenario is roughly equivalent to a price change of 5 times in the Russian M&Q sector alone.

Keywords: 2022 Russian invasion of Ukraine; Energy prices; Inflation; Input–output analysis; Leontief price model; Spillover effects (search for similar items in EconPapers)
JEL-codes: D57 N70 Q41 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0313592622002338
Full text for ScienceDirect subscribers only

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:eee:ecanpo:v:77:y:2023:i:c:p:680-695

DOI: 10.1016/j.eap.2022.12.025

Access Statistics for this article

Economic Analysis and Policy is currently edited by Clevo Wilson

More articles in Economic Analysis and Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().