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Energy Prices, Inflation, and Recession, 1974-1975

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  • Knut Anton Mork
  • Robert E. Hall

Abstract

The energy price shock depressed real output by two percent in 1974 and by five percent in 1975, according to our results. Prices rose by four percent in 1974 and by another two percent in 1975. These conclusions are derived from an aggregate model of the U.S. economy with an explicit role of energy in production. The distinction between expected and unexpected shocks is an important part of the model. We also examine monetary and fiscal policies that might have offset the energy shock.

Suggested Citation

  • Knut Anton Mork & Robert E. Hall, 1979. "Energy Prices, Inflation, and Recession, 1974-1975," NBER Working Papers 0369, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:0369
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    References listed on IDEAS

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    1. Griffin, James M & Gregory, Paul R, 1976. "An Intercountry Translog Model of Energy Substitution Responses," American Economic Review, American Economic Association, vol. 66(5), pages 845-857, December.
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    7. Daniel J.B. Mitchell, 1978. "Union Wage Determination: Policy Implications and Outlook," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 9(3), pages 537-582.
    8. Robert J. Gordon, 1970. "The Recent Acceleration of Inflation and Its Lessons for the Future," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 1(1), pages 8-47.
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    • F0 - International Economics - - General

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