1,355 research outputs found
Energy prices and aggregate economic activity: an interpretive survey
In this paper, we survey the theory and evidence linking fluctuations in energy prices to aggregate economic activity. We then briefly examine the implications of this research for both monetary policy and energy policy in response to oil price shocks. Research seems to provide relatively reliable guidance for monetary policy. Because the precise channels through which oil price shocks affect economic activity are only partially known, however, research offers less guidance about how energy policy should cope with oil price shocks.Energy policy ; Monetary policy ; Petroleum industry and trade
What drives natural gas prices?
For many years, fuel switching between natural gas and residual fuel oil kept natural gas prices closely aligned with those for crude oil. More recently, however, the number of U.S. facilities able to switch between natural gas and residual fuel oil has declined, and over the past five years, U.S. natural gas prices have been on an upward trend with crude oil prices but with considerable independent movement. Natural gas market analysts generally emphasize weather and inventories as drivers of natural gas prices. Using an error-correction model, we show that when these and other additional factors are taken into account, movements in crude oil prices have a prominent role in shaping natural gas prices. Our findings imply a continuum of prices at which natural gas and petroleum products are substitutes.
Gasoline and crude oil prices: why the asymmetry?
Many consumers complain that gasoline and crude oil prices have an asymmetric relationship in which gasoline prices raise more quickly when crude oil prices are rising than they fall when crude oil prices are falling. Many also regard the asymmetry they observe as evidence of market power in the petroleum industry. Most previous research provides econometric evidence of the asymmetry, confirming at least part of what consumers suspect. In this article Stephen Brown and Mine Yucel extend the inquiry by examining the market conditions underlying the asymmetric relationship between gasoline and crude oil prices. They find the observed asymmetry is unlikely to be the result of monopoly power. The remaining explanations for the asymmetry suggest that policies to prevent an asymmetric relationship between gasoline and crude oil prices are likely to reduce economic efficiency.
Crude oil and gasoline prices: an asymmetric relationship?
Gasoline is the petroleum product whose price is most visible and, therefore, always under public scrutiny. Many claim there is an asymmetric relationship between gasoline and oil prices - specifically, gasoline price changes follow oil price changes more quickly when oil prices are rising than when they are falling. To explore this issue, Nathan Balke, Stephen Brown and Mine Yucel use several different model specifications to analyze the relationship between oil prices and the spot, wholesale, and retail prices of gasoline. They find asymmetry is sensitive to model specification but is pervasive with the most general model.Petroleum industry and trade ; Prices
Oil price shocks and the U.S. economy: where does the asymmetry originate?
Rising oil prices appear to retard aggregate U.S. economic activity by more than falling oil prices stimulate it. Past research suggests adjustment costs and/or monetary policy may be possible explanations ofthe asymmetric response. This paper uses a quasi-vector autoregressive model of U. S. economy to examine from where the asymmetry might originate. The analysis uses counterfactual impulse response experiments to detennine that monetary policy alone cannot account for the asymmetry. The robustness ofshort-lived asymmetry across the base case and counterfactuals is consistent with the adjustment-cost explanation.Petroleum industry and trade
Business cycles: the role of energy prices
Oil price shocks have figured prominently U.S. business cycles since the end of World War II—although the relationship seems to have weakened during the 1990s. In addition the economy appears to respond asymmetrically to oil price shocks, rising oil prices hurt economic activity more than falling oil prices help it. This section of the Encyclopedia of Energy sorts through an extensive economics literature that relates oil price shocks to aggregate economic activity. It examines how oil price shocks create business cycles, why they seem to have a disproportionate effect on economic activity, why the economy responds asymmetrically to oil prices, and why the relationship between oil prices and economic activity may have weakened. It also addresses the issue of developing energy policy to mitigate the economic effects of oil price shocks.Petroleum industry and trade
Improved physiological noise regression in fNIRS: a multimodal extension of the General Linear Model using temporally embedded Canonical Correlation Analysis
For the robust estimation of evoked brain activity from functional Near-Infrared Spectroscopy (fNIRS) signals, it is crucial to reduce nuisance signals from systemic physiology and motion. The current best practice incorporates short-separation (SS) fNIRS measurements as regressors in a General Linear Model (GLM). However, several challenging signal characteristics such as non-instantaneous and non-constant coupling are not yet addressed by this approach and additional auxiliary signals are not optimally exploited. We have recently introduced a new methodological framework for the unsupervised multivariate analysis of fNIRS signals using Blind Source Separation (BSS) methods. Building onto the framework, in this manuscript we show how to incorporate the advantages of regularized temporally embedded Canonical Correlation Analysis (tCCA) into the supervised GLM. This approach allows flexible integration of any number of auxiliary modalities and signals. We provide guidance for the selection of optimal parameters and auxiliary signals for the proposed GLM extension. Its performance in the recovery of evoked HRFs is then evaluated using both simulated ground truth data and real experimental data and compared with the GLM with short-separation regression. Our results show that the GLM with tCCA significantly improves upon the current best practice, yielding significantly better results across all applied metrics: Correlation (HbO max. +45%), Root Mean Squared Error (HbO max. -55%), F-Score (HbO up to 3.25-fold) and p-value as well as power spectral density of the noise floor. The proposed method can be incorporated into the GLM in an easily applicable way that flexibly combines any available auxiliary signals into optimal nuisance regressors. This work has potential significance both for conventional neuroscientific fNIRS experiments as well as for emerging applications of fNIRS in everyday environments, medicine and BCI, where high Contrast to Noise Ratio is of importance for single trial analysis.Published versio
An international perspective on oil price shocks and U.S. economic activity
The effect of oil price shocks on U.S. economic activity seems to have changed since the mid-1990s. A variety of explanations have been offered for the seeming change—including better luck, the reduced energy intensity of the U.S. economy, a more flexible economy, more experience with oil price shocks and better monetary policy. These explanations point to a weakening of the relationship between oil prices shocks and economic activity rather than the fundamentally different response that may be evident since the mid-1990s.> ; Using a dynamic stochastic general equilibrium model of world economic activity, we employ Bayesian methods to assess how economic activity responds to oil price shocks arising from supply shocks and demand shocks originating in the United States or elsewhere in the world. We find that both oil supply and oil demand shocks have contributed significantly to oil price fluctuations and that U.S. output fluctuations are derived largely from domestic shocks.Petroleum industry and trade ; Petroleum products - Prices ; International trade ; Economic conditions - United States
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