Research On The Impact Of Energy Prices On Economic Fluctuations

The problem of economic cycle fluctuation has been one of the key issues of nationalmacroeconomic.Slow economic fluctuation and keep a sustained economic growth hasbeen the main goal of macro-control of every government. But before that we must analyzein depth what cause the economic fluctuations to better regulate macroeconomicsaccording to these factors. Since the30s of nineteenth century, the study on the impact ofeconomic fluctuations has been deepening. Now many scholars attributes economicfluctuations to the random exogenous impact, such as monetary policy shocks, technologyshocks, preference shock and so on. The economic depression triggered by the Oil crisishappened in the70s of last century made people incorporated the energy impact intomacroeconomic problems especially the fluctuation problem of economy and energy priceshocks to the economic impact cannot be ignored. This paper firstly describes thecharacteristics in Chinese economic fluctuation and study the relationship between theenergy price and GDP and the consumer price index using the econometric and statisticalanalysis method. On the basis of this, the price of energy is introduced into the indivisiblelabor RBC model, and through the calibration and Simulation of the model, verify realisticexplanation of the economy. Through establishing impulse response function to thetechnology shocks and the energy price shock, we studied the impact of technology shocksand energy price shocks on the economy.Through the analysis, we draw the following conclusions: The first one is the price ofenergy has inhibitory effect on output, and accelerating effect on inflation which has thelag characteristics on inflation. The second one is the introduction of the indivisible labormodel of RBC energy price shocks can well explain the output and consumptionfluctuations, but for the capital,it is an insufficient explanation, which may be mainly dueto the capital data which needs to further improve. The third conclusion is the technologyshock and energy price shocks can cause fluctuations in the economy, and the strength oftechnology shock is greater than the energy price shocks, but the energy price shocks oneconomic fluctuation has a long-term effect, therefore, the formulation of relevant policiesshould pay attention to energy price adjustment.