The Deflationary Conduction Effect Of Resource Products Price Fall

In recent years, a large and sustained resource price fall such as crude oil, iron ore and coal has aroused people's extensive attention. As the basic factor that influences the national economic development, the large resource price fall must exert a widespread and profound influence on the national economic development in each country or region. The continuous low price level of the major economies such as the European Union, the United States, China and Japan in recent years has also raised people's concern on the deflationary risk. Then, what is the relationship between resource price and the price level? To what extent does the large and sustained resource price fall contribute to the continuous low price level of these major economies? What kind of difference is there about the influence of resource price fall on each country or region'price level? With these questions, the research in this paper was begun.Based on the world input-output table of 2011, this paper adapts the traditional input-output price model into GIRIO price model and adopts it to measure the impacts of resource price fall on each country or region's price level for two scenarios of resource price fall 50% in Inland China and resource price fall 50% all over the world, and makes a further analysis and comparison. The main conclusions include:(1) in the scenarios of resource price fall 50% in Inland China, from the perspective of the fall' influence on each country or region's general price level through domestic conduction and international trade, the decreasing amplitude in PPI caused by this fall is bigger than that in GDP deflator; about the decreasing amplitude caused by this fall in CPI, PPI and GDP deflator, Korea, Taiwan of China, Australia, Czech, Canada and Malta are always in the list of the top-ten countries or regions that have the biggest decreasing amplitude among 40 other countries or regions except Inland China. From the perspective of the fall'influence on each country or region'three industries price level through domestic conduction and international trade, the decreasing amplitude in the secondary industry price level caused by this fall is bigger than that in the first and third industries price level; about the decreasing amplitude caused by this fall in the first, secondary and third industries price level, Korea, Taiwan of China, Australia, Malta and Canada are always in the top-ten countries or regions that have the biggest decreasing amplitude among 40 other countries or regions except Inland China. (2) in the scenarios of resource price fall 50% all over the world, from the perspective of the fall'influence on each country or region's general price level, the decreasing amplitude in PPI caused by this fall is bigger than that in CPI and GDP deflator; about the decreasing amplitude caused by this fall in CPI, PPI and GDP deflator, Luxembourg, Germany and Austria are always in the list of the top-five countries that have the smallest decreasing amplitude, however, The Rest of World is always in the list of the top-five countries or regions that have the biggest decreasing amplitude. From the perspective of the fall'influence on each country or region'three industries price level, the decreasing amplitude in the secondary industry price level caused by this fall is bigger than that in the first and third industries price level; about the decreasing amplitude caused by this fall in the first, secondary and third industries price level, only Austria is always in the top-five countries that have the smallest decreasing amplitude. From the perspective of the fall's influence on the price level in Inland China, when each countries or regions'decreasing amplitude in CPI, PPI, GDP deflator, the first industry price level, the secondary industry price level and the third industry price level are arranged according to the order from small to large, the performance of the six indexes in Inland China are respectively in the place of 34,36, 37,20,36 and 40 and this reflexes that resource price fluctuation has relatively bigger influence on China'price level. As for the question that resource price fluctuation all over the world has relatively bigger influence than that in India and Indonesia showed by the results of measuring, this paper infers that this phenomenon is possibly related to the mechanization level of first industry in these three countries. This paper gives some suggestions that target at enhancing the China's ability to do with resource price fluctuation in the last.