Global Supply Chain Disruptions and Inflation During the COVID-19 Pandemic

RePEc Short ID: psa547
ORCID iD: 0000-0002-3788-4511

LaBelle, Jesse; Santacreu, Ana Maria

Journal Article

Global Supply Chain Disruptions and Inflation During the COVID-19 Pandemic

Abstract: We investigate the role supply chain disruptions during the COVID-19 pandemic played in U.S. producer price index (PPI) inflation. We exploit pre-pandemic cross-industry variation in sourcing patterns across countries and interact it with measures of international supply chain bottlenecks during the pandemic. We show that exposure to global supply chain disruptions played a significant role in U.S. cross-industry PPI inflation between January and November 2021. If bottlenecks had followed the same path as in 2019, PPI inflation in the manufacturing sector would have been 2 percentage points lower in January 2021 and 20 percentage points lower in November 2021.

Keywords: COVID-19; supply chains; inflation;

JEL Classification: F13; F14; F44;