Working paper/research report

Publication year: 2013

URL: https://www.suerf.org/publications/suerf-policy-notes-and-briefs/disruptions-in-global-supply-chains-drive-inflation-in-the-euro-area/

Title of series: SUERF Policy Brief

Number in series: 536

Abstract: 

Interconnected global supply chains expose countries to disruptions of global value chains. This danger manifested itself during the Covid-19 pandemic between 2020 and 2022. We review results from a recent study that takes a macroeconomic perspective on global supply chain shocks. In this study, we estimate a structural vector autoregression model using data from international container trade. In order to align the shock with the established historical narrative, we not only impose restrictions on the sign of some of the responses, but also on the sign of the shock during selected episodes, i.e. (i) the Tōhoku earthquake in March 2011, (ii) the obstruction of the Suez Canal in March 2021 and (iii) the zero-Covid policy imposed by authorities in Shanghai in April 2022. We find that the supply chain shock causes a strong increase in consumer prices and a drop in real economic activity in the euro area.

Harvard Citation style: Finck, D. and Tillmann, P. (2013) Disruptions in global supply chains drive inflation in the euro area. (SUERF Policy Brief, 536). Vienna: SUERF. https://www.suerf.org/publications/suerf-policy-notes-and-briefs/disruptions-in-global-supply-chains-drive-inflation-in-the-euro-area/

APA Citation style: Finck, D., & Tillmann, P. (2013). Disruptions in global supply chains drive inflation in the euro area. (SUERF Policy Brief, 536). SUERF. https://www.suerf.org/publications/suerf-policy-notes-and-briefs/disruptions-in-global-supply-chains-drive-inflation-in-the-euro-area/