Implications of recent U.S. energy trends for trade forecasts

Craig Hakkio and Jun Nie

Economic Review, 2014, issue Q IV, 29-51

Abstract: The development of hydraulic fracturing and horizontal drilling has brought significant structural change to the energy sector, increasing energy production and decreasing net energy imports. Future changes in energy policy or technology could have even larger effects on energy exports and thus overall exports. As a result, distinguishing energy from non-energy components of trade becomes important for forecasts in both the near and longer term. Craig S. Hakkio and Jun Nie introduce models separating energy from the non-energy components of trade to examine how changes in energy production affect trade forecasts. Results from the models suggest U.S. energy exports will increase in 2014 and 2015 while non-energy exports decline, reducing the current aggregate real trade deficit by about 14 percent.

Keywords: International trade; Energy production (search for similar items in EconPapers)
Date: 2014
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