A new insight into oil price-inflation nexus
Ibrahim Raheem (),
Ajide Kazeem Bello and
Yusuf H. Agboola
Resources Policy, 2020, vol. 68, issue C
The study hypothesizes if asymmetric relationship exists between oil price and inflation nexus. Essentially, this study uses a multiple threshold nonlinear autoregressive distributed lag model in a dynamic common correlated effect within the environment of heterogeneous panel framework. Results reveal the importance of asymmetry in the model for both oil-import and exporting countries, with countries responding more to positive shocks. Quantile decompositions show that the asymmetry effect of oil price change fizzles out only for the oil importing country. For the oil exporting countries, asymmetry is important at higher quantiles. Accounting for breaks do not significantly alter earlier results. In line with empirical outcomes, policy implications are discussed.
Keywords: Oil price; Inflation; Asymmetry; Breaks; Heterogeneous panels (search for similar items in EconPapers)
JEL-codes: C21 C22 E31 Q41 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
Full text for ScienceDirect subscribers only
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eee:jrpoli:v:68:y:2020:i:c:s0301420720303597
Access Statistics for this article
Resources Policy is currently edited by R. G. Eggert
More articles in Resources Policy from Elsevier
Bibliographic data for series maintained by Nithya Sathishkumar ().