Oil Price Shocks, Output and Inflation: Evidence from Some Opec Countries

Samimi, Ahmad Jafari; Shahryar, Behnam
July 2009
Australian Journal of Basic & Applied Sciences;2009, Vol. 3 Issue 3, p2791
Academic Journal
The objective of this study was to examine the effect of oil price shock on output, inflation in six important OPEC countries using yearly data from 1970 to 2005. The structural vector autoregressive method (SVAR) was employed to analyze the data. Approximately, the findings were conformable to previous empirical findings in other countries (oil exporter countries); oil price shock affect output and inflation in all six countries. According our findings , Oil price shocks carry up prices level in Indonesia, Kuwait and Saudi Arabia but diminish it in Iran, Nigeria and Venezuela . Indonesia and Saudi Arabia are more vulnerable than others to oil price shocks but for others supply side fluctuations are mos t important factor to fluctuations of economy. Demand side shocks affect only inflation in the long run and have most effect on inflation.


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