Global Demand and Supply Sentiment: Evidence from Earnings Calls

Temel Taskin and Franz Ruch

Staff Working Papers from Bank of Canada

Abstract: This paper quantifies global demand, supply and uncertainty shocks and compares two major global recessions: the 2008–09 Great Recession and the COVID-19 pandemic. We use two alternate approaches to decompose economic shocks: text mining techniques on earnings calls transcripts and a structural Bayesian vector autoregression model. The results highlight sharp contrast in the size of supply and demand shocks over time and across sectors. While the Great Recession was characterized by demand shocks, COVID-19 caused sizable disruptions to both demand and supply. These shocks were broad-based with varying relative importance across major sectors. Furthermore, certain sub-sectors, such as professional and business services, internet retail, and grocery/department stores, fared better than others during the pandemic.

Keywords: Business fluctuations and cycles; International topics; Inflation and prices; Econometric and statistical methods; Coronavirus disease (COVID-19) (search for similar items in EconPapers)
JEL-codes: C11 C32 E32 G10 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2023-06
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Journal Article: Global Demand and Supply Sentiment: Evidence From Earnings Calls (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:bca:bocawp:23-37

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