Abstract This paper analyzes the claim that the oil embargo was blamed for many of the economic woes of the 1970s. It looks at a counter argument which states that the oil crisis was fabricated and the situation was entirely fabricated by economic policy makers. The writer examines the major economic highlights of this period in order to determine which of these claims is closer to the truth. Includes many statistics and two graphs.
From the Paper "How many goods and services a country produces is a good indication of the economic health of that country. The Gross Domestic Product (GDP) measures the production level of the country. Inflation and unemployment service to enhance the data obtained by the GDP and give us a good overall picture of who is working, what they are spending, and how much they are producing. This is one of the most misused terms by economic television commentators who often announce that there is s recession when there is a fall in the GDP for two consecutive quarters. However, it takes more than that to indicate a recession to most economists. This was the case in the 1970s. The overall growth during the decade rose. However, there were temporary dips in this growth that indicated a short downturn. Whether these downturns indicated a true recession is still argued by economists. The overall GDP increased for the 10-year period. There are also discrepancies due to whether the figure are being discussed in current dollar or real GDP. The annual percentage change in real GDP rose from 1970 to 1973, then the oil embargo and fuel crisis hit in 1974. This had a real effect of the GDP, which experienced a negative change. By 1976, the GDP had recovered and remained stable until 1980 when it again experienced a drop. "
