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Oil Prices, Exhaustible Resources, and Economic Growth

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Listed author(s):
  • James D. Hamilton

Abstract

This paper explores details behind the phenomenal increase in global crude oil production over the last century and a half and the implications if that trend should be reversed. I document that a key feature of the growth in production has been exploitation of new geographic areas rather than application of better technology to existing sources, and suggest that the end of that era could come soon. The economic dislocations that historically followed temporary oil supply disruptions are reviewed, and the possible implications of that experience for what the transition era could look like are explored.

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File URL: http://www.nber.org/papers/w17759.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 17759.

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Date of creation: Jan 2012
Publication status: published as “Oil Prices, Exhaustible Resources, and Economic Growth,” in Handbook on Energy and Climate Change, pp. 29-63, edited by Roger Fouqet, Cheltenham, United Kingdom: Edward Elgar Publishing, 2013.
Handle: RePEc:nbr:nberwo:17759
Note: EEE EFG
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Keywords:

Find related papers by JEL classification:

  • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
  • Q30 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - General
  • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
  • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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  1. Tobias N. Rasmussen & Agustin Roitman, 2011. "Oil Shocks in a Global Perspective; Are they Really That Bad?," IMF Working Papers 11/194, International Monetary Fund.
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  3. Francesco Ravazzolo & Philip Rothman, 2013. "Oil and U.S. GDP: A Real‐Time Out‐of‐Sample Examination," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 45(2-3), pages 449-463, 03.
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  8. Engemann, Kristie M. & Kliesen, Kevin L. & Owyang, Michael T., 2011. "Do Oil Shocks Drive Business Cycles? Some U.S. And International Evidence," Macroeconomic Dynamics, Cambridge University Press, vol. 15(S3), pages 498-517, November.
  9. Hamilton, James D., 2003. "What is an oil shock?," Journal of Econometrics, Elsevier, vol. 113(2), pages 363-398, April.
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  11. Leduc, Sylvain & Sill, Keith, 2004. "A quantitative analysis of oil-price shocks, systematic monetary policy, and economic downturns," Journal of Monetary Economics, Elsevier, vol. 51(4), pages 781-808, May.
  12. Christiane Baumeister & Gert Peersman, 2013. "Time-Varying Effects of Oil Supply Shocks on the US Economy," American Economic Journal: Macroeconomics, American Economic Association, vol. 5(4), pages 1-28, October.
  13. Peter Ferderer, J., 1996. "Oil price volatility and the macroeconomy," Journal of Macroeconomics, Elsevier, vol. 18(1), pages 1-26.
  14. Burbidge, John & Harrison, Alan, 1984. "Testing for the Effects of Oil-Price Rises Using Vector Autoregressions," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 25(2), pages 459-484, June.
  15. Daniel, Betty C., 1997. "International interdependence of national growth rates: A structural trends anakysis," Journal of Monetary Economics, Elsevier, vol. 40(1), pages 73-96, September.
  16. Edelstein, Paul & Kilian, Lutz, 2009. "How sensitive are consumer expenditures to retail energy prices?," Journal of Monetary Economics, Elsevier, vol. 56(6), pages 766-779, September.
  17. Roger Fouquet & Peter J.G. Pearson, 2006. "Seven Centuries of Energy Services: The Price and Use of Light in the United Kingdom (1300-2000)," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 139-178.
  18. Tatsu Kambara & Christopher Howe, 2007. "China and the Global Energy Crisis," Books, Edward Elgar Publishing, number 12522.
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Cited by:

  1. Kallis, Giorgos & Sager, Jalel, 2017. "Oil and the economy: A systematic review of the literature for ecological economists," Ecological Economics, Elsevier, vol. 131(C), pages 561-571.
  2. Renato Agurto & Fernando Fuentes & Carlos Garcia & Esteban Skoknic, 2013. "Power Generation and the Business Cycle: The Impact of Delaying Investment," ILADES-Georgetown University Working Papers inv290, Ilades-Georgetown University, Universidad Alberto Hurtado/School of Economics and Bussines.
  3. Svetlana Aleksandrova, 2016. "Impact of Oil Prices on Oil Exporting Countries in the Caucasus and Central Asia," Economic Alternatives, University of National and World Economy, Sofia, Bulgaria, issue 4, pages 447-460, December.
  4. Casey, Gregory, 2017. "Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation," MPRA Paper 76416, University Library of Munich, Germany.
  5. Arkady Gevorkyan & Willi Semmler, 2015. "Oil Price, Overleveraging, and Shakeout in the Shale Energy Sector: Game Changers in the Oil Industry," SCEPA working paper series. SCEPA's main areas of research are macroeconomic policy, inequality and poverty, and globalization. 2015-07, Schwartz Center for Economic Policy Analysis (SCEPA), The New School.
  6. Wolfgang Pollan, 2013. "US Inflation and Crude Oil Prices. An International Perspective," WIFO Working Papers 451, WIFO.

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