Taking GDP growth and inflation as endogenous variables, this paper employs a Structural VAR from Baumeister and Hamilton (2015, 2019) to identify aggregate demand and aggregate supply shocks for Bhutan, focusing on the COVID-19 pandemic. The results suggest that 94 percent of the GDP growth plunge in 2020 is attributable to a fall in aggregate supply. The higher inflation during the COVID-19 pandemic in 2020 also implies a negative supply shock. Although the magnitudes differ, characterizing the COVID-19 pandemic in Bhutan as a supply shock coincides with preceding episodes that were also primarily driven by supply shocks.
Identifer | oai:union.ndltd.org:siu.edu/oai:opensiuc.lib.siu.edu:theses-4135 |
Date | 01 December 2022 |
Creators | Dorji, Lekey |
Publisher | OpenSIUC |
Source Sets | Southern Illinois University Carbondale |
Detected Language | English |
Type | text |
Format | application/pdf |
Source | Theses |
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