Economics Seminar（2015-09）

Topic: From Boom to Bust: A Typology of Real Commodity Prices in the Long Run*

Speaker:David S. Jacks

Affiliation: Simon Fraser University and NBER

Time: Tuesday, May 19 from 2:00-3:30pm

Location: Room 217, Guanghua Building 2

Abstract:

This paper considers the evidence on real commodity prices over 165 years for 40 commodities representing 8.72 trillion US dollars of production in 2011. In so doing, it suggests and documents a comprehensive typology of real commodity prices, comprising long-run trends, medium-run cycles, and short-run boom/bust episodes. The main findings can be summarized as follows: (1) real commodity prices have been on the rise—albeit modestly—from 1950; (2) there is a consistent pattern—in both past and present—of commodity price cycles, entailing long-lived deviations from underlying trends with the set of currently evolving cycles likely having reached their peak; (3) these commodity price cycles are themselves punctuated by boom/bust episodes which are historically pervasive, exacerbated during periods of freely floating nominal exchange rates, and highly relevant for the growth experience of commodity exporting nations.

CV

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