Showing posts with label Energy & Climate Change. Show all posts
Thursday, January 9, 2014
The IMF’s estimates suggest modest impacts. Here’s a cheat sheet to the IMF’s analysis and here’s the full-blown study.
Posted by 1:37 AM
atLabels: Energy & Climate Change
Friday, December 6, 2013
The latest IMF’s Commodity Review was presented at the MENA Industrial Gas Conference 2013. On my presentation, Rob Cockerill tweeted:
The latest IMF’s Commodity Review was presented at the MENA Industrial Gas Conference 2013. On my presentation, Rob Cockerill tweeted:
Posted by 1:39 PM
atLabels: Energy & Climate Change
Tuesday, October 8, 2013
How will the shale revolution affect U.S. GDP and trade
balance? How would a growth slowdown in China affect commodity exporters?
Answers given in the IMF’s commodity markets review, released this morning as
part of the World Economic Outlook.
Shale Gale: There has been some euphoria about the impact of
the unconventional energy revolution on U.S. prospects. The simulations of the
IMF’s large scale models suggest a modest impact: increases in unconventional
energy production of the magnitude currently forecast will raise U.S. Read the full article…
Posted by 1:00 PM
atLabels: Energy & Climate Change
Wednesday, September 4, 2013
THE Prebisch-Singer hypothesis (PSH) was a staple of leftist economics during the second half of the 20th century. Raúl Prebisch and Hans Singer, working independently, showed that the “terms of trade” between primary products and manufactured goods tended to decline over time. In other words, producers of crops and raw materials gradually became poorer relative to producers of cars and household appliances. If true, the theory would have important implications for world trade; it would suggest that commodity-focused economies must diversify into other sectors or risk falling ever further behind richer countries.
A new paper* by the International Monetary Fund discusses the PSH. The authors examine 25 commodities, from sugar to silver, with some data going back to 1650. Since 1900, around 50% of the commodities show clear downward relative price slopes. About 25% show a clear upward slope. You will have to forgive the confusing labelling of the graphs, but you get the idea:
These graphs show prices relative to manufactured goods; in dollar terms many commodity prices have trended upward over the past century. So countries that produce high levels of primary products have, over time, done worse than economies which rely on manufactured goods. The authors cautiously conclude that “in the majority of cases the PSH is not rejected”.
What can primary producers do about this? In a recent conference at the IMF in Washington, one of the authors, Kaddour Hadri, suggested that commodity-dependent economies should take advantage of short periods of price spikes to invest in alternative industries. But many commodity-dependent economies fail to do this. William Sawyer, of Texas Christian University, argues that South America has failed to take advantage of high commodity prices over the past decade. As a result, their economies are not well-equipped to deal with the current price declines.
But according to Javier Blas, a journalist for the Financial Times who spoke at the IMF conference, commodity producers have been fighting against the Prebisch-Singer hypothesis for the last century. Many have shifted production away from commodities which do relatively badly against manufactured goods. The development of the soybean market, as well as shifts towards farming of chicken and pork, are some examples of this. None of these commodities appears in the IMF paper, so it does not tell a complete story. Still, and oddly enough, the IMF seems to have turned up some evidence support a bit of Marxist economic theory.
*Rabah Arezki, Kaddour Hadri, Prakash Loungani and Yao Rao (2013) ‘Testing the Prebisch-Singer Hypothesis since 1650: Evidence from Panel Techniques that Allow for Multiple Breaks’ Working Paper No. 13/180
From the Economist:
THE Prebisch-Singer hypothesis (PSH) was a staple of leftist economics during the second half of the 20th century. Raúl Prebisch and Hans Singer, working independently, showed that the “terms of trade” between primary products and manufactured goods tended to decline over time. In other words, producers of crops and raw materials gradually became poorer relative to producers of cars and household appliances. If true, the theory would have important implications for world trade;
Posted by 11:33 AM
atLabels: Energy & Climate Change
Tuesday, October 16, 2012
My presentation at the Bank of America/Merrill Lynch conference in Tokyo is available here.
My presentation at the Bank of America/Merrill Lynch conference in Tokyo is available here.
Posted by 6:10 PM
atLabels: Energy & Climate Change
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