External Capital Structures and Oil Price Volatility

40 Pages Posted: 7 Jun 2010 Last revised: 13 May 2022

See all articles by John D. Burger

John D. Burger

Loyola University Maryland - Department of Economics

Alessandro Rebucci

Johns Hopkins University - Carey Business School; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Francis E. Warnock

University of Virginia - Darden Business School; National Bureau of Economic Research (NBER)

Veronica Cacdac Warnock

Darden Business School

Multiple version iconThere are 2 versions of this paper

Date Written: June 2010

Abstract

We assess the extent to which a country's external capital structure can aid in mitigating the macroeconomic impact of oil price shocks. We study two Caribbean economies highly vulnerable to oil price shocks, an oil-importer (Jamaica) and an oil-exporter (Trinidad and Tobago). From a risk-sharing perspective, a desirable external capital structure is one that, through international capital gains and losses, helps offset responses of the current account balance to external shocks. We find that both countries could alter their international portfolio to provide a more effective buffer against such shocks.

Suggested Citation

Burger, John D. and Rebucci, Alessandro and Warnock, Francis E. and Warnock, Veronica Cacdac, External Capital Structures and Oil Price Volatility (June 2010). NBER Working Paper No. w16052, Available at SSRN: https://ssrn.com/abstract=1620769

John D. Burger (Contact Author)

Loyola University Maryland - Department of Economics ( email )

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Alessandro Rebucci

Johns Hopkins University - Carey Business School ( email )

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Baltimore, MD 21202
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HOME PAGE: http://carey.jhu.edu/faculty-research/faculty-directory/alessandro-rebucci-phd

National Bureau of Economic Research (NBER) ( email )

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Centre for Economic Policy Research (CEPR) ( email )

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Francis E. Warnock

University of Virginia - Darden Business School ( email )

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Charlottesville, VA 22906-6550
United States
434-924-6076 (Phone)

HOME PAGE: http://faculty.darden.virginia.edu/warnockf/index.htm

National Bureau of Economic Research (NBER) ( email )

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Cambridge, MA 02138-5398

Veronica Cacdac Warnock

Darden Business School ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

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