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Oil dependence and economic instability

Bibliographic Details
Main Author: Conraria, Luís Aguiar
Publication Date: 2007
Other Authors: Wen, Yi
Format: Article
Language: eng
Source: Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
Download full: http://hdl.handle.net/1822/6104
Summary: We show that dependence on foreign energy can increase economic instability by raising the likelihood of equilibrium indeterminacy, hence making fluctuations driven by self-fulfilling expectations easier to occur. This is demonstrated in a standard neoclassical growth model. Calibration exercises, based on the estimated share of imported energy in production for several countries, show that the degree of reliance on foreign energy for many countries can easily make an otherwise determinate and stable economy indeterminate and unstable.
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network_name_str Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
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spelling Oil dependence and economic instabilityIndeterminacyEnergy ImportsExternalityReturns to scaleSunspotsSelf-fulfilling expectationsWe show that dependence on foreign energy can increase economic instability by raising the likelihood of equilibrium indeterminacy, hence making fluctuations driven by self-fulfilling expectations easier to occur. This is demonstrated in a standard neoclassical growth model. Calibration exercises, based on the estimated share of imported energy in production for several countries, show that the degree of reliance on foreign energy for many countries can easily make an otherwise determinate and stable economy indeterminate and unstable.Universidade do Minho. Núcleo de Investigação em Políticas Económicas (NIPE)Universidade do MinhoConraria, Luís AguiarWen, Yi20072007-01-01T00:00:00Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttp://hdl.handle.net/1822/6104engNIPE Working Paper seriesinfo:eu-repo/semantics/openAccessreponame:Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)instname:FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologiainstacron:RCAAP2024-05-11T04:22:06Zoai:repositorium.sdum.uminho.pt:1822/6104Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireinfo@rcaap.ptopendoar:https://opendoar.ac.uk/repository/71602025-05-28T14:46:19.139280Repositórios Científicos de Acesso Aberto de Portugal (RCAAP) - FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologiafalse
dc.title.none.fl_str_mv Oil dependence and economic instability
title Oil dependence and economic instability
spellingShingle Oil dependence and economic instability
Conraria, Luís Aguiar
Indeterminacy
Energy Imports
Externality
Returns to scale
Sunspots
Self-fulfilling expectations
title_short Oil dependence and economic instability
title_full Oil dependence and economic instability
title_fullStr Oil dependence and economic instability
title_full_unstemmed Oil dependence and economic instability
title_sort Oil dependence and economic instability
author Conraria, Luís Aguiar
author_facet Conraria, Luís Aguiar
Wen, Yi
author_role author
author2 Wen, Yi
author2_role author
dc.contributor.none.fl_str_mv Universidade do Minho
dc.contributor.author.fl_str_mv Conraria, Luís Aguiar
Wen, Yi
dc.subject.por.fl_str_mv Indeterminacy
Energy Imports
Externality
Returns to scale
Sunspots
Self-fulfilling expectations
topic Indeterminacy
Energy Imports
Externality
Returns to scale
Sunspots
Self-fulfilling expectations
description We show that dependence on foreign energy can increase economic instability by raising the likelihood of equilibrium indeterminacy, hence making fluctuations driven by self-fulfilling expectations easier to occur. This is demonstrated in a standard neoclassical growth model. Calibration exercises, based on the estimated share of imported energy in production for several countries, show that the degree of reliance on foreign energy for many countries can easily make an otherwise determinate and stable economy indeterminate and unstable.
publishDate 2007
dc.date.none.fl_str_mv 2007
2007-01-01T00:00:00Z
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
dc.type.driver.fl_str_mv info:eu-repo/semantics/article
format article
status_str publishedVersion
dc.identifier.uri.fl_str_mv http://hdl.handle.net/1822/6104
url http://hdl.handle.net/1822/6104
dc.language.iso.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv NIPE Working Paper series
dc.rights.driver.fl_str_mv info:eu-repo/semantics/openAccess
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv application/pdf
dc.publisher.none.fl_str_mv Universidade do Minho. Núcleo de Investigação em Políticas Económicas (NIPE)
publisher.none.fl_str_mv Universidade do Minho. Núcleo de Investigação em Políticas Económicas (NIPE)
dc.source.none.fl_str_mv reponame:Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
instname:FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
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instname_str FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
instacron_str RCAAP
institution RCAAP
reponame_str Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
collection Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
repository.name.fl_str_mv Repositórios Científicos de Acesso Aberto de Portugal (RCAAP) - FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
repository.mail.fl_str_mv info@rcaap.pt
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