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Oil news shocks, inflation expectations and social connectedness

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  • Caraiani, Petre

Abstract

While recent work has emphasized that production networks help in the propagation of oil shocks, this paper emphasizes the role of social connections in propagating the effect of oil shocks on inflation expectations. Using a dataset of Euro Area member states, the paper shows that social connectedness has a significant role in the propagation of oil shocks on inflation expectations, with the network effects dominating the direct effects. The effects have become stronger in recent years.

Suggested Citation

  • Caraiani, Petre, 2023. "Oil news shocks, inflation expectations and social connectedness," Energy Economics, Elsevier, vol. 127(PB).
    • Handle: RePEc:eee:eneeco:v:127:y:2023:i:pb:s0140988323005522
    DOI: 10.1016/j.eneco.2023.107054
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    More about this item

    Keywords

    Oil shocks; Inflation expectations; Spatial econometrics; Network structure;
    All these keywords.

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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