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Impact of supply chain pressure on macroeconomy and stock returns – Evidence from US aggregate and sectoral markets

Author

Listed:
  • Huimin Li

    (West Chester University of Pennsylvania)

  • Dazhi Zheng

    (West Chester University of Pennsylvania)

  • Xiaowei Zhu

    (West Chester University of Pennsylvania)

Abstract

This study examines the impact of supply chain pressure on macroeconomic variables and stock returns in the U.S. from January 1998 to February 2022, after controlling for monetary policy uncertainty and oil price shock. It is found that change in supply chain pressure has a positive impact on inflation and aggregate stock return and a negative impact on change in industrial output. With respect to the sectoral returns, evidence shows that change in supply chain pressure usually has a positive impact on Basic materials, Consumer staples, Industrials, and Real estate returns. However, during the Covid-19 pandemic, change in supply chain pressure has a significant and negative impact on industrial output and stock return.

Suggested Citation

  • Huimin Li & Dazhi Zheng & Xiaowei Zhu, 2025. "Impact of supply chain pressure on macroeconomy and stock returns – Evidence from US aggregate and sectoral markets," Economics Bulletin, AccessEcon, vol. 45(1), pages 370-383.
    • Handle: RePEc:ebl:ecbull:eb-24-00008
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    File URL: http://www.accessecon.com/Pubs/EB/2025/Volume45/EB-25-V45-I1-P34.pdf
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    References listed on IDEAS

    as
    1. Boudoukh, Jacob & Richardson, Matthew, 1993. "Stock Returns and Inflation: A Long-Horizon Perspective," American Economic Review, American Economic Association, vol. 83(5), pages 1346-1355, December.
    2. Vasco M Carvalho & Makoto Nirei & Yukiko U Saito & Alireza Tahbaz-Salehi, 2021. "Supply Chain Disruptions: Evidence from the Great East Japan Earthquake," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 136(2), pages 1255-1321.
    3. Cologni, Alessandro & Manera, Matteo, 2008. "Oil prices, inflation and interest rates in a structural cointegrated VAR model for the G-7 countries," Energy Economics, Elsevier, vol. 30(3), pages 856-888, May.
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    Cited by:

    1. Dongxue Wang & Yugang He, 2025. "Navigating Structural Shocks: Bayesian Dynamic Stochastic General Equilibrium Approaches to Forecasting Macroeconomic Stability," Mathematics, MDPI, vol. 13(14), pages 1-25, July.

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    Keywords

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    JEL classification:

    • G1 - Financial Economics - - General Financial Markets
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit

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