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The Dynamic Effects of Aggregate Demand, Supply and Oil Price Shocks—A Comparative Study
Author(s) -
Bjørnland Hilde Christiane
Publication year - 2000
Publication title -
the manchester school
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.361
H-Index - 42
eISSN - 1467-9957
pISSN - 1463-6786
DOI - 10.1111/1467-9957.00220
Subject(s) - economics , aggregate demand , vector autoregression , shock (circulatory) , demand shock , recession , supply shock , unemployment , oil price , structural vector autoregression , aggregate supply , monetary economics , macroeconomics , inflation (cosmology) , aggregate (composite) , econometrics , monetary policy , medicine , physics , materials science , composite material , theoretical physics
This paper analyses the dynamic effects of aggregate demand, supply and oil price shocks on GDP and unemployment in Germany, Norway, the UK and the USA, and establishes the role of the different shocks in explaining output fluctuations over time. Symmetries of economic fluctuations across countries are also examined. The different shocks are identified by imposing dynamic restrictions on a structural vector autoregression model. For all countries except Norway, oil price shocks have significant negative effects on output. However, whereas the oil price shock in 1973–74 triggered off a global recession, the recession in the early 1980s was largely caused by other disturbances.