Will the Run Up in Gas Prices Push the Economy Back Into
Recession?  March 14, 2011  What would happen to the U.S.
economy if petroleum prices continue their rapid rise? 
University of California, San Diego, economist James Hamilton
noted in a recent study that 10 out of 11 post-World War II
recessions in the United States were preceded by a sharp
increase in the price of crude petroleum.  The only exception
was the mild recession of 1960-1961, says Ronald Bailey, Reason
Magazine's science correspondent.   So how do oil shocks cause
recessions?    • Unemployed autoworkers and idled factories
cannot be rapidly deployed to other sectors.   • While higher
oil prices contribute to recessions, lower oil prices do not
appear to have much effect on economic expansions -- people may
postpone buying a new car when gas prices are high, but they do
not rush out to buy one just because pump prices are low.  So
will the recent run up in the price of crude push the U.S.
economy back into recession?  On March 1, Federal Res