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Corresponding Author:
John O.S. Wilson, Centre for Responsible Banking & Finance, University of St Andrews Business School, University of St Andrews, St Andrews, Scotland, UK

Coauthors:
Dimitris K. Chronopoulos, Centre for Responsible Banking & Finance, University of St Andrews, St Andrews, Scotland, UK
Selçuk Gül, Central Bank of the Republic of Türkiye, Istanbul, Türkiye
Abdullah Kazdal, Central Bank of the Republic of Türkiye, Istanbul, Türkiye
Muhammed Hasan Yilmaz, Central Bank of the Republic of Türkiye, Istanbul, Türkiye

When Global Energy Costs Travel: Domestic Trade Network Channel to Firm-Level (Forthcoming in Issue 4, November 2026: “Emerging Risks, Innovation and Regulatory Developments in International Banking”)

August 3, 2026
JEL classification: D22; E31; L14; Q41
Keywords: Global Energy Prices; Energy Exposure; Trade Network; Price Stability; Inflation Expectations

Abstract

Global energy price shocks can destabilise inflation expectations, with profound implications for monetary policy and price stability. In this paper we investigate how energy exposure in domestic supply chains shape the transmission of global energy price shocks to firm-level inflation expectations. Using administrative microdata for Türkiye, we show that firms more reliant on energy inputs within their trade networks exhibit stronger responses in medium term consumer and producer price expectations. These effects are most pronounced among larger, more leveraged and higher-employment firms. Firms with a higher level of dependency are also more likely to revise pricing and unit cost expectations following energy price increases. Our results highlight the role of domestic supply chain energy exposures in shaping inflation dynamics in emerging markets amid global commodity fluctuations.


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Institute for International Economics
of the Genoa Chamber of Commerce


Istituto di Economia Internazionale
Camera di Commercio di Genova
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