IDEAS home Printed from https://ideas.repec.org/a/ecb/ecbbox/202100011.html
   My bibliography  Save this article

Pandemic-induced constraints and inflation in advanced economies

Author

Listed:
  • Bobasu, Alina
  • Crucil, Luigi
  • Dieppe, Alistair
  • Tirpák, Marcel

Abstract

This box studies the relative impact on inflation of pandemic-induced demand and supply constraints for key advanced economies outside the euro area by using granular data on consumption expenditures and prices and a structural Bayesian Vector Autoregression (BVAR) framework. It finds that during the initial phase of the pandemic, consumer price inflation was driven more by demand-sensitive components and less by supply-sensitive ones. The structural analysis confirms a dominant role for demand shocks in the pandemic. It concludes that the impact of pandemic-related supply constraints on inflation appears limited to date. Yet, more granular analysis is needed to assess the consequences of the pandemic for the drivers of inflation. JEL Classification: C11, E31, E32, O11, O40

Suggested Citation

  • Bobasu, Alina & Crucil, Luigi & Dieppe, Alistair & Tirpák, Marcel, 2021. "Pandemic-induced constraints and inflation in advanced economies," Economic Bulletin Boxes, European Central Bank, vol. 1.
    • Handle: RePEc:ecb:ecbbox:2021:0001:1
    Note: 95834
    as

    Download full text from publisher

    File URL: https://www.ecb.europa.eu//pub/economic-bulletin/focus/2021/html/ecb.ebbox202101_01~36347aacda.en.html
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Cigna, Simone & Gunnella, Vanessa & Quaglietti, Lucia, 2022. "Global value chains: measurement, trends and drivers," Occasional Paper Series 289, European Central Bank.

    More about this item

    Keywords

    demand shortages; inflation outlook; pandemic crisis; supply constraints;
    All these keywords.

    JEL classification:

    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ecb:ecbbox:2021:0001:1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Official Publications (email available below). General contact details of provider: https://edirc.repec.org/data/emieude.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.