Paper Title :An Assessment of Oil Price Fluctuation on Net Oil-importer Countries’ Economic Activity

Author :Rasheed O. Alao, Cem Payaslioglu

Article Citation :Rasheed O. Alao ,Cem Payaslioglu , (2020 ) " An Assessment of Oil Price Fluctuation on Net Oil-importer Countries’ Economic Activity " , International Journal of Management and Applied Science (IJMAS) , pp. 112-118, Volume-6,Issue-7

Abstract : We explore the control of oil price fluctuation on economic activity of oil-importers of South Korea, Indonesia and the world using cDCC-GARCH estimating technique. Confirming the findings of DCC model, we estimate the corrective and consistent cDCC-GARCH to study the volatility among oil prices and industrial production indexes of the countries under study. Findings from DCC estimates reveal that the fluctuation of returns in production has significant control on the relation between oil price movements and industrial production. Further results show that the links between oil price and industrial production in Indonesia will persist and keep on for some time and otherwise for South Korea and the world. Therefore, due to the influence of violent volatility of oil prices on Indonesia industrial productions cum cDCC-GARCH endorsement of DCC-GARCH model, Indonesia advisably needs to opt for alternative renewable sources of energy while the volatility is not so strong in Korea and the world except in 1990 and 2008 Gulf War and Asian financial crises respectively. On our note, the corrective and consistent cDCC-GARCH is a better model for DCC upgrade. Keywords - cDCC-GARCH, COVID-19, Industrial Production (IP) Index, Oil Prices, Growth, Volatility

Type : Research paper

Published : Volume-6,Issue-7

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