THIS DOI METADATA WAS LAST UPDATED: 2024-01-10 23:08
Full Title
ECONOMICS AND POLICY OF ENERGY AND THE ENVIRONMENT
Publisher
FrancoAngeli
ISSN
2280-7659 (Printed Journal)
2280-7667 (Online Journal)
Journal Issue Number
2
Journal Issue Designation
2
Journal Issue Date
2022
Full Title
The impact of oil price shocks on economic growth in Algeria
By (author)
First Page
63
Last Page
82
Language of text
English
Publication Date
2023/05
Copyright
2022 FrancoAngeli srl
Introduction or preface
In this study, we investigate the consequences of oil price shocks on Algerian economic growth, both on an aggregated and a disaggregated level. We adopt the method used in (Kilian, 2009) in which global oil supply shocks, global demand shocks, and anticipated demand shocks are defined. We use a two structural VAR models. The first model identifies shocks to oil prices using monthly data on oil production, oil real prices, and indicators of global eco- nomic activity. The second model describes the dynamics of a set of macroeconomic varia- bles: real overall GDP, hydrocarbon GDP, agricultural GDP, construction GDP, and interna- tional trade variables. To grasp the impact of oil shocks on sectoral growth, the model is aug- mented via three external shocks identified in the first stage. Our results are twofold. First, they show the significance of the oil price shocks' impact on the Algerian economy. Second, they indicate an asymmetry in this impact. Negative shocks to oil prices have depressive ef- fects on economic activity as a whole, including the non-hydrocarbon sector. We detect a delay-effect; global demand shocks affect economic sectors after 5-7 quarters, whereas oil price shocks affect the hydrocarbon sector after 1-2 quarters only.
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