Sectoral and aggregate effects of supply chain disruptions in a small open economy

We present a country-specific measure of supply chain disruptions and compare it with a global counterpart. We identify each measure’s macroeconomic role and consider a sectoral extension using the two-digit NACE level of disaggregation and a multi-sector general equilibrium model to assess the contribution of each sector to CPI inflation. Our results indicate that supply chain disruptions elicit substantial contractionary effects both at the macroeconomic level and in most sectors, and that country-level disruptions significantly dominate their global counterparts. The manufacturing sector emerges as the main domestic transmitter of shocks, with significant spillovers to private services. Consumer preferences tend to spread supply chain disruptions fairly evenly across COICOP categories as they pass through to CPI inflation.