IAEE Members and subscribers to The Energy Journal: Please log in to access the full text article or receive discounted pricing for this article.

Business Cycles and the Oil Market

The last twenty years have seen a number of oil-price changes with macroeconomic effects. Oil price increases spur inflation and produce recessions. Oil price declines dampen inflation, but do not necessarily boost real activity. The correlations can be traced back to World War II. The paper gives a survey of oil market events with macroeconomic consequences. It also discusses hypotheses about the nature of the link and efforts to incorporate oil in macroeconomic models. Business cycle research has recently advanced sectoral imbalance and uncertainty as leading hypotheses to explain the apparent asymmetry in the macroeconomic effects of oil price changes.

Purchase ( $25 )

Energy Specializations: Petroleum – Markets and Prices for Crude Oil and Products; Energy Investment and Finance – Corporate Strategy

JEL Codes: Q43: Energy and the Macroeconomy, Q41: Energy: Demand and Supply; Prices

Keywords: Oil Market, business cycles, oil prices, asymmetry, oil shocks

DOI: 10.5547/ISSN0195-6574-EJ-Vol15-NoSI-3

Published in Volume 15, Special Issue of the bi-monthly journal of the IAEE's Energy Economics Education Foundation.


© 2023 International Association for Energy Economics | Privacy Policy | Return Policy