Appendix Table 1

Granger causality test results: Effects of steel prices on end-use goods prices

End-use product k-lags Cointegrated relationship Causal relationship Primary aluminum content χ^2 Probability of statistical significance Estimated effect of 1% aluminum price increase after three months
Beverage industry
Beverage manufacturing (PCU31213121) 1 N N 10% 0.857 64.6% 0.0%
Beverages and beverage materials (WPS026) 2 N N 0.388 46.7% 0.0%
Canned beer and ale case goods (PCU3121203121201) 1 N N 0.897 65.6% 0.0%
Aluminum cans (PCU3324313324313) 1 N N 1.240 73.5% 0.0%
Aluminum cans and can components (WPU10310331) 1 N N 0.857 64.6% 0.0%
Architectural and structural metals
Nonresidential construction, goods (WPUIP2312001) 1 N N 6% 0.893 65.5% 0.0%
Kitchen utensils
Stamped and spun kitchen utensils, aluminum (WPU12680101) 3 N Weak 4% 3.038 91.9% <0.1%
Motor vehicle parts
Motor vehicle body manufacturing (PCU336211336211) 1 N N 14% 0.197 34.3% 0.0%
Motor vehicles parts (WPU1412) 3 N Y 1% 20.81 99.9% <0.1%
Furniture
Commercial furniture (WPU122) 1 N N 3% 0.016 10.0% 0.0%
Industrial production
Secondary smelting and alloying of aluminum (NAICS = 331314) (IPN331314S) 3 N N NA 0.049 17.6% 0.0%
Misc. aluminum materials (NAICS = 331315) 2 N N NA 0.303 41.8% 0.0%
Aluminum extruded product (NAICS = 331318) 3 N N NA 2.515 88.7% 0.0%

Source: Authors’ analysis of BLS (2021b, 2021c, and 2021d) and FRED (2021) data.

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