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Macroeconomic Responses to Oil Price Increases and Decreases in Seven OECD Countries

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  • Knut Anton Mork
  • ystein Olsen
  • Hans Terje Mysen

Abstract

The correlations between oil-price movements and GDP fluctuations are investigated for the United States, Canada, Japan, Germany (West), France, the United Kingdom, and Norway. The responses to price increases and decreases are allowed to be asymmetric. Bivariate correlations as well as partial correlations within a reduced-form macroeconomic model are considered. The correlations with oil-price increases are negative and significant for most countries, but positive for Norway, whose oil-producing sector is large relative to the economy as a whole. The correlations with oil-price decreases are mostly positive, but significant only for the United States and Canada. Most countries show evidence of asymmetric effects, with Norway again as an exception.

Suggested Citation

  • Knut Anton Mork & ystein Olsen & Hans Terje Mysen, 1994. "Macroeconomic Responses to Oil Price Increases and Decreases in Seven OECD Countries," The Energy Journal, , vol. 15(4), pages 19-35, October.
    • Handle: RePEc:sae:enejou:v:15:y:1994:i:4:p:19-35
    DOI: 10.5547/ISSN0195-6574-EJ-Vol15-No4-2
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    References listed on IDEAS

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    1. Knut Anton Mork, 1994. "Business Cycles and the Oil Market," The Energy Journal, International Association for Energy Economics, vol. 0(Special I), pages 15-38.
    2. Michael Bruno & Jeffrey D. Sachs, 1985. "Economics of Worldwide Stagflation," NBER Books, National Bureau of Economic Research, Inc, number brun85-1, July.
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    Cited by:

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    3. Apostolakis, George N. & Giannellis, Nikolaos, 2024. "Asymmetric effects of monetary policy shocks on financial stability," The Journal of Economic Asymmetries, Elsevier, vol. 30(C).
    4. Emrah I. Cevik & Sel Dibooglu & Max Gillman & Szilard Benk, 2025. "Granger predictability of real oil prices by us money and inflation in Markov-switching regimes," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 15(1), pages 29-52, March.
    5. Augustine Adebayo Kutu & Abieyuwa Ohonba, 2024. "The Impact of Crude Oil Price Fluctuation on Revenue Generation in the Oil Dependent Economy: Nigeria," International Journal of Energy Economics and Policy, Econjournals, vol. 14(5), pages 181-190, September.
    6. Mei Lu & Michael G Pollitt, 2025. "Will high carbon prices reduce fossil fuel use in China? Evidence from price elasticity estimates using firm data," Working Papers EPRG2508, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    7. Ma, Yong & Li, Shuaibing & Zhou, Mingtao, 2024. "Forecasting crude oil prices: Does global financial uncertainty matter?," International Review of Economics & Finance, Elsevier, vol. 96(PC).
    8. Patricia Renou-Maissant, 2019. "Is Oil Price Still Driving Inflation?," Post-Print hal-05021637, HAL.
    9. Hajer Zarrouk & Mohamed Khalil Ouafi, 2025. "Oil Prices, Sustainability Initiatives, and Stock Market Dynamics: Insights from the MSCI UAE Index," JRFM, MDPI, vol. 18(6), pages 1-24, June.

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