PRESS-NEWS.org - Press Release Distribution
PRESS RELEASES DISTRIBUTION

Evaluating price hikes: Research shows that recent oil shocks are not causing inflation

2011-11-22
(Press-News.org) MANHATTAN, KAN. -- While the price of oil has risen in recent years, it has not affected the price of goods as much as in the past, according to research by two Kansas State University economists.

More than that, the prices of many goods -- such as clothing or vacations -- are actually deflating instead of inflating because of improved technology and reduced energy costs.

Lance Bachmeier, associate professor of economics, and Inkyung Cha, adjunct professor of economics, discuss oil shocks and inflation in an article titled "Why Don't Oil Shocks Cause Inflation? Evidence From Disaggregate Inflation Data." The article appeared in a recent issue of the Journal of Money, Credit and Banking, a leading journal in economic research.

Bachmeier and Cha used inflation data from the Bureau of Labor Statistics to look at more than 100 core goods. Core goods do not include groceries, but rather include goods such as cars, household appliances, clothing, cosmetics, toys and vacations. Such goods are not affected as much by oil shocks, Bachmeier said, but have actually experienced some minor deflation from rising oil prices.

"If you used to spend $10 to fill your tank, and now you are spending $20, that gives you $10 less to spend on cosmetics or clothing," Bachmeier said. "So that causes the demand of those goods to fall, and then the price falls."

Bachmeier and Cha focused their efforts on data from 1973 to 2006. They began with the 1970s because of two large oil price increases that occurred in 1973 and 1979 and caused inflation in the prices of core goods. The 1990s brought even larger oil shocks, yet the prices of core goods didn't go up. The researchers wanted to understand the two decades and how they related to inflation and the current oil industry.

"Many economists would say that the difference in inflation for these two decades was caused solely by monetary policy," Bachmeier said. "But when we looked at the data for core goods, we found that is not the case."

Instead, the researchers found another factor that influenced inflation: As time progressed, manufacturers began to use less energy. When production costs are lower, prices often lower, too.

The biggest cost for some manufacturers is energy, so even small advances in technology have helped reduce production costs. For instance, newer technology has helped diesel trucks get 7 miles per gallon, when they used to get 4.8 miles per gallon in 1977. Other technologies have created more energy-efficient methods of producing paper and steel, among other developments.

The researchers attribute reduced energy usage for two-thirds of the change in inflation response to oil shocks and they attribute monetary policy for the remaining one-third.

"There is always a demand for energy-efficient technology," Bachmeier said. "But now, manufacturing plants are adopting new technologies faster, saving more money and lowering prices."

Gas prices and the oil industry

Consumers have noticed it at the pump: Gas prices are temporarily lowering.

Bachmeier attributes the lower prices to uncertainty about the global economy. Without this uncertainly, gas prices might reach $5 a gallon, he said.

Even more, it is hard to predict the direction of gas prices right now because of market uncertainty in Iran and other Middle Eastern countries, the weak United States and European economies, and the fact that consumers might change their behavior now that they realize gas prices are not likely to return to $1.50 per gallon.

"United States consumers will realize that gas prices are not likely to go much below where they are right now," Bachmeier said. "Some college students and others with low incomes will walk or ride bicycles when possible. Consumers will put more emphasis on gas mileage when they buy a new vehicle. Even at $3 per gallon, an average middle-age male driver will save about $200 per month on gas by driving a Hyundai Elantra rather than an SUV."

INFORMATION:

END



ELSE PRESS RELEASES FROM THIS DATE:

Kazawest Announces the Addition of a Mixed-Use Development in Vancouver's Victoria Drive District to its Property Management Portfolio

2011-11-22
Kazawest Services Inc. is pleased to announce the addition of a mixed-use development, located in the Victoria Drive district of Vancouver (http://www.vancouver.ca), to its strata management portfolio. The property consists of commercial retail units on the ground level with premium condominium residences above. Through its integrated real estate services, strength in customer service and deep knowledge of building operations, Kazawest is leading the property management sector in British Columbia. "We are pleased the strata council for this property has chosen ...

Butterfly wings inspire design of water-repellent surface

2011-11-22
The brilliant blue wings of the mountain swallowtail (Papilio ulysses) easily shed water because of the way ultra-tiny structures in the butterfly's wings trap air and create a cushion between water and wing. Human engineers would like to create similarly water repellent surfaces, but past attempts at artificial air traps tended to lose their contents over time due to external perturbations. Now an international team of researchers from Sweden, the United States, and Korea has taken advantage of what might normally be considered defects in the nanomanufacturing process ...

Psychological factors affect IBS patients' interpretation of symptom severity

2011-11-22
A patient's viewpoint of the severity of irritable bowel syndrome (IBS) symptoms can be influenced not only by physical symptoms of IBS but broader psychological problems, according to a new study in Clinical Gastroenterology and Hepatology, the official journal of the American Gastroenterological Association. "Clinicians who face pressure to treat patients in a cost-effective manner within tight time constraints and at a satisfactory level are likely to find that patient-reported outcome data can increase their understanding of what patients mean when they describe how ...

A new model for understanding biodiversity

2011-11-22
Animals like foxes and raccoons are highly adaptable. They move around and eat everything from insects to eggs. They and other "generalist feeders" like them may also be crucial to sustaining biological diversity, according to a new study published in the Proceedings of the National Academy of Sciences (PNAS). McGill biology researchers have developed a unified, spatially based understanding of biodiversity that takes into account the complex food webs of predators and prey. "Biodiversity exists within a landscape. Predators and prey are continuously on the move as their ...

Carbon nanotube forest camouflages 3-D objects

Carbon nanotube forest camouflages 3-D objects
2011-11-22
Carbon nanotubes, tiny cylinders composed of one-atom-thick carbon lattices, have gained fame as one of the strongest materials known to science. Now a group of researchers from the University of Michigan is taking advantage of another one of carbon nanotubes' unique properties, the low refractive index of low-density aligned nanotubes, to demonstrate a new application: making 3-D objects appear as nothing more than a flat, black sheet. The refractive index of a material is a measure of how much that material slows down light, and carbon nanotube "forests" have a low ...

MacTransco Remains One of South Africa's Leading Freight Logistic Providers

2011-11-22
MacTransco is one of South Africa's leading haulers of processed and unprocessed goods. Markus van der Merwe, Director of MacTransco, believes one of the company's key advantages lies in the location of its operations in Lephalale and Messina. He describes Messina, which is also where the company's head office is situated, as "the gateway to Africa" because of its continued development. "There is a lot of commodity coming through Messina into Africa in addition to large investments being made in the mines," explains van der Merwe. Van der Merwe stresses ...

How ink flows, speedy neutrinos may leave LHC trails, and seeing Schroedinger's cat

How ink flows, speedy neutrinos may leave LHC trails, and seeing Schroedingers cat
2011-11-22
Hydrodynamics of writing with ink Jungchul Kim, Myoung-Woon Moon, Kwang-Ryeol Lee, L. Mahadevan, and Ho-Young Kim Physical Review Letters (forthcoming) For millennia, writing has been the preferred way to convey information and knowledge from one generation to another. We first developed the ability to write on clay tablets with a point, and then settled on a reed pen, as preserved from 3000 BC in Egypt when it was used with papyrus. This device consisted of a hollow straw that served as an ink reservoir and allowed ink to flow to its tip by capillary action. A quill ...

Bokamoso Private Hospital: Providing Specialist Healthcare in Botswana

2011-11-22
Bokamoso Private Hospital, located just west of Gaborone in Botswana, has been operational since January 2010. The vision in setting up a brand new hospital was to provide specialist services and facilities not previously catered for in existing hospitals in Botswana. "One of our unique selling points is the range of specialist services that we provide," says Gontle Moleele, the Chief Medical Officer at Bokamoso Private Hospital. Services available at the hospital include neurology, cardiology, endocrinology, haemodialysis, sports medicine, pathology and gynecology, ...

Powerhouse Clothing Company (Pty) Ltd: Compound Growth in an Industry Under Siege

2011-11-22
The Powerhouse Clothing Company is one of South Africa's most flexible and innovative clothing manufacturers. The company is 100 percent dedicated to manufacturing solely in South Africa, despite a growing competition from companies in the East and cheap imports from outside SA being at all time high in the clothing industry. As a result of Powerhouse's aim to be a wholly South African company, its supply chain is one of its most important operating focuses. "If your supply chain is not working in tandem together then everything falls apart," notes Justin Mansfield, ...

Second-generation ethanol processing cost prohibitive

2011-11-22
Costs for second-generation ethanol processing, which will ease the stress on corn and sugarcane, are unlikely to be competitive until 2020, according to a unique Queen's University study. "This study really lays out in black and white where we are and where we are going," says Warren Mabee, an assistant professor in the School of Policy Studies and Department of Geography. "It should prompt companies to reassess (their processes going forward)." The researchers found that building large scale facilities for second-generation ethanol production will be more costly than ...

LAST 30 PRESS RELEASES:

Scientists uncover key to decoupling economic growth from pollution in developing countries

Frailty fuels gut imbalance and post-surgery gastrointestinal risks

BMS-986504 demonstrates durable responses in MTAP-deleted NSCLC, including EGFR and ALK-positive tumors

Phase III trial finds hypofractionated radiotherapy with chemotherapy offers comparable survival and lower toxicity to conventional schedule in LS-SCLC

Lung cancer screening benefits adults up to age 80 if surgical candidates, UK study finds

Video assisted thoracoscopy surgery reduces mortality by 21 percent compared to lobectomy

NADIM ADJUVANT trial suggests benefit of adjuvant chemo-immunotherapy in resected stage IB–IIIA NSCLC

EA5181 phase 3 trial finds no OS benefit for concurrent and consolidative durvalumab vs consolidation alone in unresectable stage 3 NSCLC

Training to improve memory

Are patients undergoing surgery for early-stage cancer at risk of persistent opioid use?

Black youth, especially Black girls, use mental health services less than their White peers

Canada must protect youth from sports betting advertising

First-in-human trial shows promising results for DLL3-targeted antibody-drug conjugate SHR-4849 in relapsed small cell lung cancer

Ifinatamab deruxtecan demonstrates high response rate in previously treated extensive-stage small cell lung cancer: Phase 2 IDeate-Lung01 trial

Higher blood pressure in childhood linked to earlier death from heart disease in adulthood

AI helped older adults report accurate blood pressure readings at home

High blood pressure in childhood and premature cardiovascular disease mortality

Zidesamtinib shows durable responses in ROS1 TKI pre-treated NSCLC, including patients with CNS disease and ROS1 G2032R mutations

Crizotinib fails to improve disease-free survival in resected early-stage ALK+ NSCLC

Ivonescimab plus chemotherapy improves progression-free survival in patients with EGFR+ NSCLC following 3rd-generation EGFR-TKI therapy

FLAURA2 trial shows osimertinib plus chemotherapy improves overall survival in eGFR-mutated advanced NSCLC

Aumolertinib plus chemotherapy improves progression-free survival in NSCLC with EGFR and concomitant tumor suppressor genes: ACROSS 2 phase III study

New antibody-drug conjugate shows promising efficacy in EGFR-mutated NSCLC patients

Iza-Bren in combination with osimertinib shows 100% response rate in EGFR-mutated NSCLC, phase II study finds

COMPEL study shows continuing osimertinib treatment through progression with the addition of chemotherapy improves progression-free survival in EGFR-mutated NSCLC

CheckMate 77T: Nivolumab maintains quality of life and reduces symptom deterioration in resectable NSCLC

Study validates AI lung cancer risk model Sybil in predominantly Black population at urban safety-net hospital

New medication lowered hard-to-control high blood pressure in people with chronic kidney disease

Innovative oncolytic virus and immunotherapy combinations pave the way for advanced cancer treatment

New insights into energy metabolism and immune dynamics could transform head and neck cancer treatment

[Press-News.org] Evaluating price hikes: Research shows that recent oil shocks are not causing inflation