ABSTRACT
In this chapter an analytical framework is developed for estimating the impact of oil import price shocks on the structure and level of domestic prices, assuming a fixed-coefficient input-output technology. The analysis of this chapter is therefore short-run in nature in the sense that it is applicable only for a relatively short time horizon over which technological shifts have not yet occurred. In Chapter 4 the assumption of fixed-coefficients is relaxed and the impact of technological shifts induced by higher oil prices is then examined.
