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Record Nr. |
UNINA9910155013203321 |
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Autore |
Comelli Fabio |
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Titolo |
To Bet or Not to Bet : : Copper Price Uncertainty and Investment in Chile / / Fabio Comelli, Esther Perez Ruiz |
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Pubbl/distr/stampa |
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Washington, D.C. : , : International Monetary Fund, , 2016 |
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ISBN |
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1-4755-5375-7 |
1-4755-5389-7 |
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Descrizione fisica |
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1 online resource (23 pages) : illustrations (some color), tables |
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Collana |
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Altri autori (Persone) |
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Disciplina |
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Soggetti |
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Copper - Prices - Chile |
Investments: Metals |
Foreign Exchange |
Investments: Options |
Macroeconomics |
Intertemporal Firm Choice and Growth, Investment, or Financing |
Investment |
Capital |
Intangible Capital |
Capacity |
'Panel Data Models |
Spatio-temporal Models' |
Metals and Metal Products |
Cement |
Glass |
Ceramics |
Price Level |
Inflation |
Deflation |
Pension Funds |
Non-bank Financial Institutions |
Financial Instruments |
Institutional Investors |
Currency |
Foreign exchange |
Finance |
Investment & securities |
Metal prices |
Asset prices |
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Exchange rates |
Options |
Copper |
Prices |
Financial institutions |
Commodities |
Metals |
Derivative securities |
Chile |
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Lingua di pubblicazione |
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Formato |
Materiale a stampa |
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Livello bibliografico |
Monografia |
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Nota di bibliografia |
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Includes bibliographical references. |
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Sommario/riassunto |
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A strand of research documents Chile’s copper dependence hence significant exposure to terms of trade shocks. Copper prices’ sharp decline and forecast uncertainty since the end of the commodity super-cycle has rekindled the debate on Chile’s adjustment capacity to external shocks. Following Malz (2014), this paper builds a time-varying measure of copper price uncertainty using options contracts. VAR analysis shows that the investment response to an uncertainty shock of average magnitude in the sample is strong and persistent: the cumulative fall in investment from trend at a one-year horizon ranges 2–5.8 percentage points; and it takes between 1½ and 2 years for investment to return to its trend level. Empirical ranges depend on alternative definitions for investment, uncertainty, and options’ maturing time. |
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