Commodity prices and international Inflation, 1851–1913

Stefan Gerlach and Rebecca Stuart

Journal of International Money and Finance, 2024, vol. 144, issue C

Abstract: This paper uses annual data to study the impact of commodity prices on consumer prices in 15 economies from 1851 to 1913. We calculate a simple measure of the common component of commodity prices which co-moves with the international business cycle and Granger causes consumer price inflation. Commodity prices are significant in standard inflation equations estimated by OLS in 14 of 15 economies. Estimating these equations using real shipping costs as an instrument suggests that commodity price movements associated with shifts in demand arising from international business cycles have a particularly large impact on inflation.

Keywords: Commodity prices; Gold standard; International inflation; Business cycle (search for similar items in EconPapers)
JEL-codes: E31 F40 N10 (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jimfin:v:144:y:2024:i:c:s0261560624000846

DOI: 10.1016/j.jimonfin.2024.103097

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