ABSTRACT
On January 21, 1981, within moments of being inaugurated, President Ronald Reagan enacted the "final" decontrol of oil prices. With the stabilization of oil prices in late 1981 and the onset of a downward trend in 1982, culminating in a modest price break in early 1983, the national energy psychology changed dramatically. In the media, Congress, and academia, discussions of the benefits of falling energy prices became prominent. The chapter shows that, through the early part of 1983, there had been no actual price relief for lower income households and not much for the economy as a whole. In order to estimate the impact of price trends on household energy bills, it is necessary also to examine trends in energy consumption. By the most important measure, energy expenditures as a percentage of household income or gross national product, the national energy burden had marked time in the period between early 1981 and early 1983.
