On the Sources of Oil Price Fluctuations

29 Pages Posted: 5 Jan 2010

See all articles by Deren Unalmis

Deren Unalmis

University of York

Ibrahim Unalmis

Government of the Republic of Turkey - Central Bank of the Republic of Turkey

D. Filiz Unsal

International Monetary Fund (IMF) - Research Department

Date Written: December 2009

Abstract

Analyzing macroeconomic impacts of oil price changes requires first to investigate different sources of these changes and their distinct effects. Kilian (2009) analyzes the effects of an oil supply shock, an aggregate demand shock, and a precautionary oil demand shock. The paper's aim is to model macroeconomic consequences of these shocks within a new Keynesian DSGE framework. It models a small open economy and the rest of the world together to discover both accompanying effects of oil price changes and their international transmission mechanisms. Our results indicate that different sources of oil price fluctuations bring remarkably diverse outcomes for both economies.

Keywords: Demand, Economic models, External shocks, Fiscal policy, Inflation targeting, Monetary policy, Oil prices, Oil production, Price increases, Productivity, Supply

Suggested Citation

Unalmis, Deren and Unalmis, Ibrahim and Unsal, D. Filiz, On the Sources of Oil Price Fluctuations (December 2009). IMF Working Papers, Vol. , pp. 1-28, 2009. Available at SSRN: https://ssrn.com/abstract=1531518

Deren Unalmis (Contact Author)

University of York ( email )

Heslington
University of York
York, YO10 5DD
United Kingdom

Ibrahim Unalmis

Government of the Republic of Turkey - Central Bank of the Republic of Turkey ( email )

Istiklal Cad. 10 Ulus
06100 Ankara, Ankara 06050
Turkey

D. Filiz Unsal

International Monetary Fund (IMF) - Research Department ( email )

700 19th Street NW
Washington, DC 20431
United States

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