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Oil Prices, Monetary Policy, and Counterfactual Experiments
- Journal of Money, Credit, and Banking
- The Ohio State University Press
- Volume 38, Number 7, October 2006
- pp. 1945-1958
- 10.1353/mcb.2006.0090
- Article
- Additional Information
Recessions are associated with both rising oil prices and increases in the federal funds rate. Are recessions caused by the spikes in oil prices or by the sharp tightening of monetary policy? This paper discusses the difficulties in disentangling these two effects.