{
  "title": "Supply Bottlenecks: Where, Why, How Much, and What Next?",
  "publication": "IMF Working Papers, February 17, 2022",
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  "summary": "Supply constraints hurt the economic recovery and boosted inflation in 2021. We find that in the euro area, manufacturing output and GDP would have been about 6 and 2 percent higher, respectively, and half of the rise in manufacturing producer price inflation would not have occurred in the absence o",
  "sections": [
    {
      "heading": "Key findings",
      "content": "- Supply constraints hurt the economic recovery and boosted inflation in 2021.\n- In the euro area:\n  - Manufacturing output would have been about 6 percent higher in the absence of supply bottlenecks.\n  - GDP would have been about 2 percent higher in the absence of supply bottlenecks.\n  - Half of the rise in manufacturing producer price inflation would not have occurred in the absence of supply bottlenecks.\n- Globally, shutdowns can explain up to 40 percent of the supply shocks.\n- Sectors more reliant on differentiated inputs—such as autos—are harder hit."
    },
    {
      "heading": "Quantitative estimates and scope",
      "content": "- Manufacturing output: about 6 percent higher in the euro area without bottlenecks.\n- GDP: about 2 percent higher in the euro area without bottlenecks.\n- Contribution of shutdowns to global supply shocks: up to 40 percent.\n- Report length: 50 pages.\n- Series and identification: Working Paper No. 2022/031; Issue 031; Volume 2022; Stock No. WPIEA2022031; ISBN 9798400202476; ISSN 1018-5941; DOI https://doi.org/10.5089/9798400202476.001."
    },
    {
      "heading": "Drivers, sectors, and mechanisms",
      "content": "- Shutdowns are a major contributor to supply shocks (up to 40 percent globally).\n- Reliance on differentiated inputs amplifies vulnerability; autos identified as a notably affected sector.\n- Supply bottlenecks translated directly into higher producer price inflation in manufacturing."
    },
    {
      "heading": "Timing, outlook, and scenarios",
      "content": "- Late last year industry experts expected:\n  - Supply shortages for autos to largely dissipate by mid-2022.\n  - Broader bottlenecks to ease by end-2022.\n- Given the Omicron wave, disruptions are expected to last for longer, possibly into 2023."
    },
    {
      "heading": "Policy implications and recommendations",
      "content": "- Supply constraints are adding to price pressures.\n- The core policy challenge: support the economic recovery without allowing high inflation to become entrenched.\n- Policymakers need to weigh measures that alleviate supply-side frictions while avoiding policies that would lock in elevated inflation.\n\nIMF Working Paper No. 2022/031 by Oya Celasun, Niels-Jakob H Hansen, Aiko Mineshima, Mariano Spector, and Jing Zhou (February 17, 2022).\n\n---\n\n Content in this bundle\n\n- Working Paper\n  - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2022/02/15/supply-bottlenecks-where-why-how-much-and-what-next-513188"
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    "Authors: Oya Celasun, Niels-Jakob H Hansen, Aiko Mineshima, Mariano Spector, Jing Zhou",
    "Published: February 17, 2022",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9798400202476.001",
    "Supply constraints hurt the economic recovery and boosted inflation in 2021.",
    "In the euro area:",
    "Globally, shutdowns can explain up to 40 percent of the supply shocks.",
    "Sectors more reliant on differentiated inputs—such as autos—are harder hit.",
    "Manufacturing output: about 6 percent higher in the euro area without bottlenecks.",
    "GDP: about 2 percent higher in the euro area without bottlenecks.",
    "Contribution of shutdowns to global supply shocks: up to 40 percent.",
    "Report length: 50 pages.",
    "Series and identification: Working Paper No. 2022/031; Issue 031; Volume 2022; Stock No. WPIEA2022031; ISBN 9798400202476; ISSN 1018-5941; DOI https://doi.org/10.5089/9798400202476.001.",
    "Shutdowns are a major contributor to supply shocks (up to 40 percent globally).",
    "Reliance on differentiated inputs amplifies vulnerability; autos identified as a notably affected sector.",
    "Supply bottlenecks translated directly into higher producer price inflation in manufacturing.",
    "Late last year industry experts expected:",
    "Given the Omicron wave, disruptions are expected to last for longer, possibly into 2023.",
    "Supply constraints are adding to price pressures.",
    "The core policy challenge: support the economic recovery without allowing high inflation to become entrenched.",
    "Policymakers need to weigh measures that alleviate supply-side frictions while avoiding policies that would lock in elevated inflation.",
    "**Working Paper**"
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