Commodity price shocks are frequently considered among the most important potential threats to the global economy. However, since the second half of the 1980s, energy prices have experienced very large changes, with arguably limited effects on global GDP developments. This column presents evidence that oil shocks just aren’t what they used to be when it comes to macroeconomic effects.

Was the surge in the oil prices between 2003 and 2008 caused by financial investors taking speculative positions in oil futures markets? Many pundits and policymakers seem to think so, but this column says this view goes against the extensive body of evidence.

After several decades of quiescence, global commodity prices almost doubled in 2008 and, after a brief fall, rose again in 2011. The papers in this new CEPR eReport aim to identify and assess the importance of the factors responsible for the recent increases in the levels and volatility of commodity prices.

The recent boom in primary commodity prices has once more stimulated interest in the issue of “Dutch Disease” – the changes in a country’s structure of production expected after a favourable shock such as a large natural resource discovery. This column examines the implications for welfare and some policy options for resource-rich countries.

How do commodity-price booms affect the economic performance of commodity exporters? This column presents comprehensive new data on country-specific commodity terms of trade. It finds that, on average, countries grow nearly 2 percentage points faster during booms than during busts. But policy plays an important role – sharp currency appreciations and large government deficits are associated with lower growth.

In a recent speech, Fed Chair Ben Bernanke highlighted the difficulty of obtaining a meaningful gauge for future commodity price movement, noting the inadequacy of forecasts based on commodity futures signals. Looking at exchange rates may be a promising alternative.

The WTO talks were as much a distraction as an opportunity. The agenda was aimed at a world that no longer exists. Negotiations of some form should and will resume: the questions are "where?" and "between whom?" Success will require a different game, with different rules and different players. This column considers the options.

In CEPR Policy Insight No. 25, Jeffrey Frankel discusses the merits of a peg to the export price for countries specialized in the production of a mineral or agricultural commodity.

This column introduces Jeffrey Frankel’s Policy Insight No. 25 explaining his proposal for countries to peg their currencies to their export prices. Such a peg adjusts to trade shocks and serves as a nominal anchor, so it may outperform current exchange rate regimes.