IDEAS home Printed from https://ideas.repec.org/p/zbw/ifwkwp/120.html
   My bibliography  Save this paper

Quantifying the effects of higher world oil prices on recource allocation and living standards in an energy poor open economy

Author

Listed:
  • Vincent, David P.

Abstract

The OPEC Cartel's spectacular success in raising real world oil prices over the past decade has brought about substantial net resource transfers from energy poor to energy rich countries within the world economy. In accomodating these resource transfers both energy exporting and importing economies have been confronted with adjustment pressures. Of course the intensity and nature of these adjustment pressures has differed substantially between countries according to amongst other things a country's resource endowment, its net trade position with respect to oil and other energy based products and the degree of openness of its economy to world trade. Our concern in this paper is with quantifying the short and medium term adjustment pressures imposed on the South Korean economy assuming continued increases in real world oil prices. The results are derived from a multisectoral general equilibrium model. A feature of the model is its design flexibility and simple solution algorithm. We exploit this in the present study by comparing results for a range of experiments to accommodate differing assumptions about the Korean macroeconomic environment, labour market behaviour and Korean export demand. While the numerical results refer specifically to Korea, it is to be hoped that by rationalising them in terms of the underlying structural features inherent in the Korean economy the paper provides some guidance on the sorts of adjustment pressures likely to confront energy poor open economies assuming a continued movement in the world terms of trade towards oil.

Suggested Citation

  • Vincent, David P., 1981. "Quantifying the effects of higher world oil prices on recource allocation and living standards in an energy poor open economy," Kiel Working Papers 120, Kiel Institute for the World Economy (IfW Kiel).
  • Handle: RePEc:zbw:ifwkwp:120
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/46936/1/015023095.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Wolfgang F. Stolper & Paul A. Samuelson, 1941. "Protection and Real Wages," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 9(1), pages 58-73.
    2. Vincent, David P., 1981. "Multisectoral economic models for developing countries," Kiel Working Papers 117, Kiel Institute for the World Economy (IfW Kiel).
    3. Taylor, Lance & Black, Stephen L., 1974. "Practical general equilibrium estimation of resource pulls under trade liberalization," Journal of International Economics, Elsevier, vol. 4(1), pages 37-58, April.
    4. Staelin, Charles P., 1976. "A general-equilibrium model of tariffs in a noncompetitive economy," Journal of International Economics, Elsevier, vol. 6(1), pages 39-63, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. P. B. Dixon & D. P. Vincent, 1980. "Some Economic ImDlications of Technical Change in Australia to 1990–91:An Illustrative Application of the SNAPSHOT Model," The Economic Record, The Economic Society of Australia, vol. 56(155), pages 347-361, December.
    2. Dixon, Peter B. & Rimmer, Maureen T., 2016. "Johansen's legacy to CGE modelling: Originator and guiding light for 50 years," Journal of Policy Modeling, Elsevier, vol. 38(3), pages 421-435.
    3. Coyle, Barry & Chambers, Robert G. & Schmitz, Andrew, 1986. "Economic Gains from Agricultural Trade: A Review and Bibliography," Miscellaneous Publications 319990, United States Department of Agriculture, Economic Research Service.
    4. Dixon, Peter B. & Koopman, Robert B. & Rimmer, Maureen T., 2013. "The MONASH Style of Computable General Equilibrium Modeling: A Framework for Practical Policy Analysis," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 23-103, Elsevier.
    5. Dee, Philippa S., 1984. "Will bank interest rate deregulation jeopardize economic growth? A case study of South Korea," Kiel Working Papers 203, Kiel Institute for the World Economy (IfW Kiel).
    6. Jaime Melo, 1980. "Tariffs and resource allocation in partial and in general equilibrium," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 116(1), pages 114-130, March.
    7. Dani Rodrik, 2018. "Populism and the economics of globalization," Journal of International Business Policy, Palgrave Macmillan, vol. 1(1), pages 12-33, June.
    8. M. Magnani, 2009. "Labor share dynamics: a survey of the theory," Economics Department Working Papers 2009-EP07, Department of Economics, Parma University (Italy).
    9. Isaac K. Ofori, 2021. "Towards Building Shared Prosperity in Sub-Saharan Africa: How Does the Effect of Economic Integration Compare to Social Equity Policies?," Working Papers of the African Governance and Development Institute. 21/045, African Governance and Development Institute..
    10. Assaf Razin & Efraim Sadka, 1996. "Fiscal Balance During Inflation, Disinflation, and Immigration: Policy Lessons," IMF Working Papers 1996/033, International Monetary Fund.
    11. Tschopp, Jeanne, 2015. "The Wage Response to Shocks: The Role of Inter-Occupational Labour Adjustment," Labour Economics, Elsevier, vol. 37(C), pages 28-37.
    12. Roberto Veneziani & Luca Zamparelli & Michalis Nikiforos & Gennaro Zezza, 2017. "Stock-Flow Consistent Macroeconomic Models: A Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 31(5), pages 1204-1239, December.
    13. Larch Mario & Lechthaler Wolfgang, 2011. "Comparative Advantage and Skill-Specific Unemployment," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 11(1), pages 1-58, April.
    14. Sabine Engelmann, 2014. "International trade, technological change and wage inequality in the UK economy," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 41(2), pages 223-246, May.
    15. Ariel Burstein & Jonathan Vogel, 2011. "Factor Prices and International Trade: A Unifying Perspective," NBER Working Papers 16904, National Bureau of Economic Research, Inc.
    16. Kis-Katos, Krisztina & Sparrow, Robert, 2015. "Poverty, labor markets and trade liberalization in Indonesia," Journal of Development Economics, Elsevier, vol. 117(C), pages 94-106.
    17. Gene M. Grossman & Esteban Rossi-Hansberg, 2008. "Trading Tasks: A Simple Theory of Offshoring," American Economic Review, American Economic Association, vol. 98(5), pages 1978-1997, December.
    18. Michelle R. Garfinkel & Stergios Skaperdas & Constantinos Syropoulos, 2009. "International Trade and Transnational Insecurity: How Comparative Advantage and Power are Jointly Determined," Working Papers 080921, University of California-Irvine, Department of Economics.
    19. D. Vines, 1994. "Australian Trade Liberalisation, APEC, and the GATT," Economics Discussion / Working Papers 94-11, The University of Western Australia, Department of Economics.
    20. Rodríguez Chatruc, Marisol & Stein, Ernesto H. & Vlaicu, Razvan, 2019. "Trade Attitudes in Latin America: Evidence from a Multi-Country Survey Experiment," IDB Publications (Working Papers) 9603, Inter-American Development Bank.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:ifwkwp:120. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/iwkiede.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.