The Distributional Implications of the Impact of Fuel Price Increases on Inflation
The Distributional Implications of the Impact of Fuel Price Increases on Inflation

Author: Mr. Kangni R Kpodar

Publisher: International Monetary Fund

Published: 2021-11-12

Total Pages: 34

ISBN-13: 1616356154

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This paper investigates the response of consumer price inflation to changes in domestic fuel prices, looking at the different categories of the overall consumer price index (CPI). We then combine household survey data with the CPI components to construct a CPI index for the poorest and richest income quintiles with the view to assess the distributional impact of the pass-through. To undertake this analysis, the paper provides an update to the Global Monthly Retail Fuel Price Database, expanding the product coverage to premium and regular fuels, the time dimension to December 2020, and the sample to 190 countries. Three key findings stand out. First, the response of inflation to gasoline price shocks is smaller, but more persistent and broad-based in developing economies than in advanced economies. Second, we show that past studies using crude oil prices instead of retail fuel prices to estimate the pass-through to inflation significantly underestimate it. Third, while the purchasing power of all households declines as fuel prices increase, the distributional impact is progressive. But the progressivity phases out within 6 months after the shock in advanced economies, whereas it persists beyond a year in developing countries.

Economic Effects of Recent Increases in Energy Prices
Economic Effects of Recent Increases in Energy Prices

Author: John Peterson

Publisher: Government Printing Office

Published: 2006-08

Total Pages: 40

ISBN-13:

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NOTE: NO FURTHER DISCOUNT FOR THIS PRINT PRODUCT--OVERSTOCK SALE -- Significantly reduced list price while supplies last Analyzes the short-term macroeconomic effects of the recent rise in energy prices as well as the likely effects over the next ten years. Utility company personnel, American citizens and consumers, economists, and energy policy advocates may be interested in this volume to compare it to today's energy position and dependence in America. Middle school students and above may be interested in this volume for research papers. All libraries should have a copy of this text in their reference collections. Related products: International Energy Outlook 2016, With Projections to 2040 can be found here: https://bookstore.gpo.gov/products/sku/061-003-01167-5 New Realities: Energy Security in the 2010s and Implications for the U.S. Military is available here: https://bookstore.gpo.gov/products/sku/008-000-01093-5 Energy& Fuels resources collection can be found here: https://bookstore.gpo.gov/catalog/science-technology/energy-fuels Other reports produced by the U.S. Congressional Budget Office (CBO) can be found here: https://bookstore.gpo.gov/agency/237

Impact of High Energy Prices on Germany’s Potential Output
Impact of High Energy Prices on Germany’s Potential Output

Author: Miss Yushu Chen

Publisher: International Monetary Fund

Published: 2023-07-24

Total Pages: 14

ISBN-13:

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The surge in energy prices since Russia’s invasion of Ukraine has reduced the energy-intensive sector’s production in Germany, although the non-energy intensive sector’s production has held up thanks in part to firms’ efforts to improve energy efficiency. Energy prices are expected to remain elevated in the foreseeable future, compared to pre-war levels, adversely affecting firms’ productivity and thus lowering Germany’s potential output. Economic modeling suggests that this effect could be around 11⁄4 percent of GDP in staff’s baseline, with some uncertainty around this estimate, depending on the ultimate magnitude of the energy price shock and the degree to which increased energy efficiency can mitigate it. Policies can promote effective adjustment to the shock by increasing productivity and maintaining strong price incentives to conserve energy and invest in renewable energy production.

Made in Mexico
Made in Mexico

Author: Jorge Alvarez

Publisher: International Monetary Fund

Published: 2015-02-27

Total Pages: 30

ISBN-13: 1498342515

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This paper assesses the real effects of the energy reform in Mexico by looking at its impact on manufacturing output through changes in energy prices. Using sub-sector and state-level manufacturing output data, along with past variation in energy prices, we find electricity prices––relative to oil and gas––to be more important in the manufacturing process, with a one standard deviation reduction in electricity prices leading to a 2.8 percent increase in manufacturing output. Our estimated elasticities together with plausible reductions in electricity tariffs derived from the energy reform, could increase manufacturing output by up to 3.6 percent, and overall real GDP by 0.6 percent. Larger reductions are possible over the long run if increased efficiency in the sector leads electricity prices to converge to U.S. levels. Moreover, including the impact of lower electricity tariffs on the services sector, could lead to significantly larger effects on GDP. Accounting for endogeneity of unit labor costs in a panel VAR setting leads to an additional indirect channel which amplifies the impact of electricity prices on output.

Impacts of Higher Energy Prices on Agriculture and Rural Economies
Impacts of Higher Energy Prices on Agriculture and Rural Economies

Author: United States Department of Agriculture

Publisher: CreateSpace

Published: 2015-07-20

Total Pages: 52

ISBN-13: 9781515145394

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Agricultural production is sensitive to changes in energy prices, either through energy consumed directly or through energy-related inputs such as fertilizer. A number of factors can affect energy prices faced by U.S. farmers and ranchers, including developments in the oil and natural gas markets, and energy taxes or subsidies. Climate change policies could also affect energy prices as a result of taxes on emissions, regulated emission limits, or the institution of a market for emission reduction credits. Here we review the importance of energy in the agricultural sector and report the results of a case study on the economic implications for the farm sector of energy price increases that would arise from plausible, constructed greenhouse-gas-emission reduction scenarios. Higher energy-related production costs would generally lower agricultural output, raise prices of agricultural products, and reduce farm income, regardless of the reason for the energy price increase. Nonetheless, farm sector impacts were modest for the scenarios and time periods examined. We demonstrate the unique distribution of effects resulting from price (or cost) increases for different types of energy due to pricing their carbon content, as well as the relative use of energy in production of different agricultural commodities. Our analysis focuses on relatively short-term adjustments to higher energyrelated costs and does not include potential financial benefits from sequestering carbon or reduced climate change. Finally, we find that agricultural sector impacts on farming-dependent counties would not be substantial but would be potentially largest where education and employment levels are relatively low, while effects on rural communities due strictly to energy production adjustments would be concentrated in the few U.S. counties with significant employment in energy extraction industries.