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    OPEC and the international oil market: Can a cartel fuel the engine of economic development?


    Pecchenino, Rowena A. (2007) OPEC and the international oil market: Can a cartel fuel the engine of economic development? International Journal of Industrial Organization, 25 (1). pp. 187-199. ISSN 0167-7187

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    Abstract

    The OPEC cartel was formed to promote two economic goals, one microeconomic — low oil market volatility — the other macroeconomic — promotes economic development of its members. These goals create a tension since the cartel's single tool is output quotas. Using this dual micro/macro perspective we analyze oil exporting countries' behavior. We find that the effects of the cartel's choices will be reflected in oil market stability, long-term macroeconomic development, and international oil market structure. If an oil producing country cares about both oil industry profits and macroeconomic stability, the goal of output stability may be inconsistent with cartel membership.

    Item Type: Article
    Keywords: Oil market volatility; Oil market structure; Economic development;
    Academic Unit: Faculty of Social Sciences > Economics, Finance and Accounting
    Item ID: 8510
    Identification Number: https://doi.org/10.1016/j.ijindorg.2006.04.010
    Depositing User: Prof. Rowena Pecchenino
    Date Deposited: 25 Jul 2017 17:10
    Journal or Publication Title: International Journal of Industrial Organization
    Publisher: Elsevier
    Refereed: Yes
    URI:

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