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RWP 17-10, September 2017; Updated December 2018

We examine the implications of the U.S. shale oil boom for the U.S. economy, trade balances, and the global oil market. Using comprehensive data on different types of crude oil, and a two-country general equilibrium model with heterogenous oil and refined products, we show that the shale boom boosted U.S. real GDP by 1 percent and improved the oil trade balance as a share of GDP by more than 1 percentage points from 2010 to 2015. The boom led to a decline in oil and fuel prices, and a dramatic fall in U.S. light oil imports. In addition, we find that the crude oil export ban, which was in place during a large part of this boom, was a binding constraint, and would likely have remained a binding constraint thereafter had the policy not been removed at the end of 2015.

JEL Classification: F41, Q33, Q38, Q43

Article Citation

  • Çakır Melek, Nida, Michael Plante, and Mine K. Yücel. 2017. “Resource Booms and the Macroeconomy: The Case of U.S. Shale Oil.” Federal Reserve Bank of Kansas City, Research Working Paper 17-10, September. Available at External Link


Nida Çakır Melek

Senior Economist

Nida Çakır Melek is a senior economist in the Economic Research Department of the Federal Reserve Bank of Kansas City. She joined the Bank in August 2013 after receiving her Ph.D…