John Taylor has produced a comprehensive and insightful paper. He begins by reviewing what he calls the “Great Inflation,” the period of the 1970s and early 1980s. Following Brad De Long’s observation that by the early 1970s, well before the oil shocks, baseline U.S. inflation was already in the 4 percent to 5 percent range, John Taylor rejects the hypothesis that the oil price shocks of the pe...

This study is an attempt to examine the effects of external shocks on macroeconomic variables in selective small open emerging economies in Southeast Asia. A quarterly Global Vector Autoregressive (GVAR) model, including 33 countries, was used throughout 1979–2013. The empirical results showed that the target countries were affected by external shocks, especially the shocks in the U.S, Euro are...

Using high-frequency (daily) data on macroeconomic uncertainties and the partial cross-quantilogram approach, we examine directional predictability of disentangled oil-price shocks for entire conditional distribution five advanced economies (Canada, Euro Area, Japan, United Kingdom, States). Our results show that oil-demand, oil-supply, financial-risk-related can predict future path uncertainty...

Working papers of the Federal Reserve Bank of Cleveland are preliminary materials circulated to stimulate discussion and critical comment on research in progress. They may not have been subject to the formal editorial review accorded offi cial Federal Reserve Bank of Cleveland publications. The views stated herein are those of the authors and are not necessarily those of the Federal Reserve Ban...

The Response of Consumption in Russian Households to Economic Shocks This paper examines the extent to which consumption in Russian households responds to exogenous income shocks. During the time period studied in this paper (1994 – 1998), Russia experienced two major economic crises. Both featured extreme movements in the real ruble-dollar exchange rate. The price of oil, which is typically th...

Beginning in 2009, in many advanced economies, policy rates reached their zero lower bound (ZLB). Almost at the same time, oil prices started rising again. We analyze how the ZLB affects the propagation of oil shocks. As these shocks move inflation and output in opposite directions, their effects on economic activity are cushioned when monetary policy is constrained. The burst of inflation from...