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Oil Prices and Consumption across Countries and U.S. States

Andrea De Michelis (), Thiago Revil T. Ferreira and Matteo Iacoviello ()
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Thiago Revil T. Ferreira: https://www.federalreserve.gov/econres/thiago-r-t-ferreira.htm

No 1263, International Finance Discussion Papers from Board of Governors of the Federal Reserve System (U.S.)

Abstract: We study the effects of oil prices on consumption across countries and U.S. states, by exploiting the time-series and cross-sectional variation in oil dependency of these economies. We build two large datasets: one with 55 countries over the years 1975-2018, and another with all U.S. states over the period 1989-2018. We then show that oil price declines generate positive effects on consumption in oil-importing economies, while depressing consumption in oil-exporting economies. We also document that oil price increases do more harm than the good afforded by oil price decreases both in the world and U.S. aggregates.

Keywords: Oil prices; Consumption; Cross-country; U.S. states; Oil dependency (search for similar items in EconPapers)
JEL-codes: E32 F40 Q43 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2019-11-07
New Economics Papers: this item is included in nep-ene, nep-his and nep-mac
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Journal Article: Oil Prices and Consumption across Countries and U.S. States (2020) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgif:1263

DOI: 10.17016/IFDP.2019.1263

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