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Relative efficiency of oil price versus oil output in promoting economic growth: Is OPEC’s strategy right?

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  • Olesia Kozlova

    (Whittier College)

  • Jose Noguera-Santaella

    (Universidad de Santiago de Chile)

Abstract

A dilemma faced by oil exporting countries is the relative efficiency of the traditional OPEC cartel policy of setting quotas to target a certain crude oil price level versus the policy usually followed by non-OPEC countries of choosing the crude oil output level that maximizes profits, taking the oil price level as given. This paper contributes to the oil and macroeconomics literature by using panel cointegration techniques that consider cross-sectional dependence and structural breaks to study the relative efficiency of these policies to promote economic growth in oil exporting countries.

Suggested Citation

  • Olesia Kozlova & Jose Noguera-Santaella, 2019. "Relative efficiency of oil price versus oil output in promoting economic growth: Is OPEC’s strategy right?," Empirical Economics, Springer, vol. 57(6), pages 1997-2012, December.
    • Handle: RePEc:spr:empeco:v:57:y:2019:i:6:d:10.1007_s00181-018-1537-1
    DOI: 10.1007/s00181-018-1537-1
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    More about this item

    Keywords

    Oil price; Oil production; Oil exporters; OPEC; Economic growth; Panel cointegration;
    All these keywords.

    JEL classification:

    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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