The Response of Industrial Production to the Price of Oil: New Evidence for Thailand

Komain Jiranyakul ()
Additional contact information
Komain Jiranyakul: School of Development Economics, National Institute of Development Administration, Bangkok, Thailand.

Turkish Economic Review, 2017, vol. 4, issue 2, 193-204

Abstract: This paper examines the oil price-industrial production nexus in Thailand by using multivariate cointegration test. In addition, Granger causality is also used to examine the impact of oil price uncertainty on industrial production growth. The main focus of this paper is on one sector of the economy, i.e., manufacturing sector. Monthly data from 1993 to 2015 are utilized. Empirical results reveal that there is a long-run relationship between industrial production and real oil price and other variables. Industrial production adjusts rapidly to shocks to lending rate, price level and oil price. Furthermore, there exists long-run causality running from lending rate, price level and oil price to industrial production. However, industrial production growth does not respond to oil price shock and oil price uncertainty. Asymmetric and nonlinear relationship between oil price shock and industrial output growth is not found. These findings give some policy implications.

Keywords: Industrial production; Oil price shock; Oil price volatility; Cointegration; Causality. (search for similar items in EconPapers)
JEL-codes: C22 Q43 (search for similar items in EconPapers)
Date: 2017
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.kspjournals.org/index.php/TER/article/download/1320/1290 (application/pdf)
http://www.kspjournals.org/index.php/TER/article/view/1320 (text/html)

Related works:
Working Paper: The response of industrial production to the price of oil: new evidence for Thailand (2016)
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:ksp:journ2:v:4:y:2017:i:2:p:193-204

Access Statistics for this article

Turkish Economic Review is currently edited by Bilal KARGI

More articles in Turkish Economic Review from KSP Journals Istanbul, Turkey.
Bibliographic data for series maintained by Bilal KARGI ( this e-mail address is bad, please contact ).