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A two-country theoretical model is presented, showing the effects of monetary, fiscal, and supply-side disturbances on prices of primary commodities and manufactured goods, and on exchange rates. If monetary shocks dominate, then commodity prices should lead general price movements, and the level of commodity prices should be correlated with the general inflation rate. Country-specific commodity price indexes are developed for the major industrial countries. Several empirical tests broadly support the conclusions of the model. Commodity price levels tend to be cointegrated with consumer-price inflation rates. Commodity price movements contribute weakly to predictions of inflation rates but more strongly to predictions of turning points in inflation.

Commercial products --- Commodities --- Commodity Markets --- Commodity price indexes --- Commodity prices --- Consumer prices --- Deflation --- Inflation --- Investment & securities --- Investments: Commodities --- Macroeconomics --- Price indexes --- Price Level --- Prices --- Japan

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The role of the international commodity market in transmitting disturbances is considered in a model that incorporates commodities as an input in production. The analysis employs a three-country framework: a liquidity-constrained commodity supplier and two industrial countries that import the commodity, export differentiated manufactured goods and hold the outstanding debt of the commodity exporter. In this setting the impact of changes in fiscal policy, commodity supplies, and the real interest rate are assessed. Particular attention is paid to the responses of the real exchange rate, commodity prices, and the international distribution of debt to the various shocks.

Commercial products --- Commodities --- Commodity Markets --- Commodity prices --- Consumption --- Currency --- Economics --- Fiscal Policy --- Fiscal policy --- Foreign Exchange --- Foreign exchange --- Investment & securities --- Investments: Commodities --- Macroeconomics --- Macroeconomics: Consumption --- National accounts --- Prices --- Public Finance --- Real exchange rates --- Saving --- Wealth --- United States

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This paper examines annual commodity price data from England and Holland over a span of seven centuries. Our data incorporates transaction prices on seven commodities: barley, butter, cheese, oats, peas, silver, and wheat, as well as pound/shilling nominal exchange rates going back, in some cases, to 1273. We find that the magnitude, volatility, and persistence of deviations from the law of one price have not declined by as much as one might expect. We find this despite lower transport costs, reduced trade protection, and fewer wars and plagues in the modern era. Our analysis is consistent with growing evidence that goods-market arbitrage remains highly imperfect, even today.

Investments: Commodities --- Investments: Metals --- Macroeconomics --- Foreign Exchange --- Commodity Markets --- Agriculture: General --- Metals and Metal Products --- Cement --- Glass --- Ceramics --- Investment & securities --- Agricultural commodities --- Commodities --- Commodity prices --- Metal prices --- Silver --- Prices --- Farm produce --- Commercial products --- Metals --- United Kingdom

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The aim is to analyze the main channels of transmission for shocks from the global economy to Guyana and assess their specific spillover magnitudes. The paper documents the transmission channels of external shocks to the real economy and the financial sector, citing magnitudes and risks. It then describes the policy response, including recent directions of monetary and fiscal policies to weather the spillover of external shocks on the domestic economy through the real and trade channel, and provides an outlook for the envisaged recovery of the global economy.

Investments: Commodities --- Exports and Imports --- Macroeconomics --- Public Finance --- Fiscal Policy --- Agriculture: General --- Trade: General --- Commodity Markets --- Investment & securities --- International economics --- Agricultural commodities --- Fiscal stance --- Fiscal policy --- Exports --- Commodity prices --- Commodities --- International trade --- Farm produce --- Prices --- Commercial products --- Guyana

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The paper describes a global model consisting of several industrial and developing country blocks built to analyze alternative economic policies in a medium-term context. The model, which has been used to construct medium-term scenarios for the World Economic Outlook, consists of aggregate demand and supply relationships, with endogenous determination of interest rates, prices, and exchange rates. Financing flows to developing countries depend on expectations of their ability to service debt. Expectations of interest rates, inflation, and exchange rates are modeled in a way that is consistent with the model’s solution, and budget constraints are imposed on governments.

Commercial products --- Commodities --- Commodity Markets --- Consumption --- Deflation --- Economics --- Export prices --- Exports and Imports --- Exports --- Imports --- Inflation --- International economics --- International trade --- Investment & securities --- Investments: Commodities --- Macroeconomics --- Macroeconomics: Consumption --- National accounts --- Price Level --- Prices --- Saving --- Trade: General --- Wealth --- United States