 Propagation of Shocks to Food and Energy Prices: A Cross-Country AnalysisCzech Journal of Economics and Finance (Finance a uver), 2015, vol. 65, issue 4, 272-289 Abstract: The present paper analyzes the propagation of shocks to food and energy prices in 46 countries with data from the period 1999–2010. Empirical evidence suggests that in all but one country shocks to either energy or food prices propagate to prices of goods and services included in the core inflation measures. In general, the propagation effect of food price shocks is larger than that of energy price shocks. Emerging economies are more affected by propagation than are advanced ones, which is supported by analysis of variance decompositions, which suggests that especially food components explain the larger part of the variability of core inflation in emerging countries. The weights of food components in the consumer baskets seem to impact the magnitude of propagation, particularly in emerging economies. The results advocate that policymakers concerned with price stability should pay special attention to shocks affecting domestic food prices. Keywords: propagation; inflation; shocks; cross-country (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:fau:fauart:v:65:y:2015:i:4:p:272-289 Access Statistics for this article More articles in Czech Journal of Economics and Finance (Finance a uver) from Charles University Prague, Faculty of Social Sciences Contact information at EDIRC. |
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