Abstract
The disruptions in the world oil market during the 1970s and the subsequent business cycle fluctuations set off a round of research on the macroeconomic effects of such price shocks. Theoretical explanations for the link between changes in oil prices and fluctuations in the overall economic activity level were presented (see e.g. Phelps, 1978), and a number of simulation studies were carried out (Pierce and Enzler, 1974; Gordon, 1975; Mork and Hall, 1980). Empirical investigations of the relationship have also been undertaken by Darby (1982), Hamilton (1983), Burbridge and Harrison (1984) and Gisser and Goodwin (1986). For an oil-importing country both theory and data point to a negative correlation between increases in petroleum prices and the overall activity level. According to Hamilton (1983), there were thus clear tendencies of stagnation in the US economy occurring six months to one year after the two oil price rises in the 1970s, as well as earlier in the postwar period. Similar impacts from the oil price shocks are estimated for other countries (Burbridge and Harrison, (1984).
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Mork, K.A., Mysen, H.T., Olsen, Ø. (1990). Business cycles and oil price fluctuations: some evidence for six OECD countries. In: Bjerkholt, O., Olsen, Ø., Vislie, J. (eds) Recent Modelling Approaches in Applied Energy Economics. International Studies in Economic Modelling. Springer, Dordrecht. https://doi.org/10.1007/978-94-011-3088-2_13
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DOI: https://doi.org/10.1007/978-94-011-3088-2_13
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