Asymmetric effect of oil price change on inflation: Evidence from Sub Saharan Africa countries
This study is aimed at investigating the asymmetric effect of oil price on inflation for Sub Saharan Africa (SSA) countries. Based on the findings from the dynamic heterogenous nonlinear panel ARDL estimation, a panel data representation of Shin et al. (2014), the long run asymmetric relationship ex...
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| Format: | Article |
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EconJournals
2021
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| _version_ | 1825937670563430400 |
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| author | Babuga, Umar Tijjani Niaz Ahmad, Mohd Naseem |
| author_facet | Babuga, Umar Tijjani Niaz Ahmad, Mohd Naseem |
| author_sort | Babuga, Umar Tijjani |
| collection | UPM |
| description | This study is aimed at investigating the asymmetric effect of oil price on inflation for Sub Saharan Africa (SSA) countries. Based on the findings from the dynamic heterogenous nonlinear panel ARDL estimation, a panel data representation of Shin et al. (2014), the long run asymmetric relationship exists between both oil price increase (op+) and decrease (op-) and inflation for these countries. Nevertheless, the oil price increase tends to exert more effect on inflation than the oil price decrease. For policy implication, the monetary authorities shall pay more attention to the increase in oil price than the oil price decrease in designing appropriate policies of price stability as the former exerts greater impact on inflation than the latter. The price stability as one of the key macroeconomic goals could be attained if these countries understand the oil price-inflation relationship and then monetary measures can be adjusted to endure the effect of oil price changes especially increase in oil price on the price level so that stability in the prices of output can be maintained. |
| first_indexed | 2024-03-06T11:03:03Z |
| format | Article |
| id | upm.eprints-96128 |
| institution | Universiti Putra Malaysia |
| last_indexed | 2024-03-06T11:03:03Z |
| publishDate | 2021 |
| publisher | EconJournals |
| record_format | dspace |
| spelling | upm.eprints-961282023-02-21T03:04:07Z http://psasir.upm.edu.my/id/eprint/96128/ Asymmetric effect of oil price change on inflation: Evidence from Sub Saharan Africa countries Babuga, Umar Tijjani Niaz Ahmad, Mohd Naseem This study is aimed at investigating the asymmetric effect of oil price on inflation for Sub Saharan Africa (SSA) countries. Based on the findings from the dynamic heterogenous nonlinear panel ARDL estimation, a panel data representation of Shin et al. (2014), the long run asymmetric relationship exists between both oil price increase (op+) and decrease (op-) and inflation for these countries. Nevertheless, the oil price increase tends to exert more effect on inflation than the oil price decrease. For policy implication, the monetary authorities shall pay more attention to the increase in oil price than the oil price decrease in designing appropriate policies of price stability as the former exerts greater impact on inflation than the latter. The price stability as one of the key macroeconomic goals could be attained if these countries understand the oil price-inflation relationship and then monetary measures can be adjusted to endure the effect of oil price changes especially increase in oil price on the price level so that stability in the prices of output can be maintained. EconJournals 2021 Article PeerReviewed Babuga, Umar Tijjani and Niaz Ahmad, Mohd Naseem (2021) Asymmetric effect of oil price change on inflation: Evidence from Sub Saharan Africa countries. International Journal of Energy Economics and Policy, 11 (1). 448 - 458. ISSN 2146-4553 https://www.econjournals.com/index.php/ijeep/article/view/10764/5617 10.32479/ijeep.10764 |
| spellingShingle | Babuga, Umar Tijjani Niaz Ahmad, Mohd Naseem Asymmetric effect of oil price change on inflation: Evidence from Sub Saharan Africa countries |
| title | Asymmetric effect of oil price change on inflation: Evidence from Sub Saharan Africa countries |
| title_full | Asymmetric effect of oil price change on inflation: Evidence from Sub Saharan Africa countries |
| title_fullStr | Asymmetric effect of oil price change on inflation: Evidence from Sub Saharan Africa countries |
| title_full_unstemmed | Asymmetric effect of oil price change on inflation: Evidence from Sub Saharan Africa countries |
| title_short | Asymmetric effect of oil price change on inflation: Evidence from Sub Saharan Africa countries |
| title_sort | asymmetric effect of oil price change on inflation evidence from sub saharan africa countries |
| work_keys_str_mv | AT babugaumartijjani asymmetriceffectofoilpricechangeoninflationevidencefromsubsaharanafricacountries AT niazahmadmohdnaseem asymmetriceffectofoilpricechangeoninflationevidencefromsubsaharanafricacountries |