7 research outputs found
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Sellers’ Inflation, Profits and Conflict: Why can Large Firms Hike Prices in an Emergency?
The dominant view of inflation holds that it is macroeconomic in origin and must always be tackled with macroeconomic tightening. In contrast, we argue that the US COVID-19 inflation is predominantly a sellers’ inflation that derives from microeconomic origins, namely the ability of firms with market power to hike prices. Such firms are price makers, but they only engage in price hikes if they expect their competitors to do the same. This requires an implicit agreement which can be coordinated by sector-wide cost shocks and supply bottlenecks. We review the long-standing literature on price-setting in concentrated markets and survey earnings calls and compile firm-level data to derive a three-stage heuristic of the inflationary process: (1) Rising prices in systemically significant upstream sectors due to commodity market dynamics or bottlenecks create windfall profits and provide an impulse for further price hikes. (2) To protect profit margins from rising costs, downstream sectors propagate, or in cases of temporary monopolies due to bottlenecks, amplify price pressures. (3) Labor responds by trying to fend off real wage declines in the conflict stage. We argue that such sellers’ inflation generates a general price rise which may be transitory, but can also lead to self-sustaining inflationary spirals under certain conditions. Policy should aim to contain price hikes at the impulse stage to prevent inflation from the onset
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World Profit Rates, 1960-2019
In this paper we present estimates of the world profit rate using country-level data from the Extended Penn World Table 7.0 and industry-level data from the World Input Output Database. The country-aggregated world profit rate series spans the period from 1960 to 2019, and the industry-aggregated world profit rate series runs from 2000 to 2014. The country-aggregated world profit rate series displays a strong negative linear trend for the period 1960-1980 and a weaker negative linear trend from 1980 to 2019. A medium run decomposition analysis reveals that the decline in the world profit rate is driven by a decline in the output-capital ratio. The industry-aggregated world profit rate shows a negative linear trend for the period 2000-2014, which, once again, is driven by a fall in the output-capital ratio. We have created a World Profitability Dashboard to allow researchers to freely access profit rate series and the underlying data at country, industry, country-group and world levels of aggregation
A genome-wide association study of metabolic traits in human urine
We present a genome-wide association study of metabolic traits in human urine, designed to investigate the detoxification capacity of the human body. Using NMR spectroscopy, we tested for associations between 59 metabolites in urine from 862 male participants in the population-based SHIP study. We replicated the results using 1,039 additional samples of the same study, including a 5-year follow-up, and 992 samples from the independent KORA study. We report five loci with joint P values of association from 3.2 × 10(-19) to 2.1 × 10(-182). Variants at three of these loci have previously been linked with important clinical outcomes: SLC7A9 is a risk locus for chronic kidney disease, NAT2 for coronary artery disease and genotype-dependent response to drug toxicity, and SLC6A20 for iminoglycinuria. Moreover, we identify rs37369 in AGXT2 as the genetic basis of hyper-β-aminoisobutyric aciduria