Tim Taylor does a nice job of summarizing the Congressional Budget Office study on the economic benefits derived from shale oil and gas in the US. In the short run, GDP was increased substantially. The increased output of these products in 2013 was $195 billion. That raised GDP by 1.2%. The increase in investment spending on shale oil and gas added another 0.9% to GDP for a total gain in GDP of 2.1%. In the longer term, lower energy prices will boost productivity in energy intensive industries which will increase wages and employment in those industries. That will also increase consumer spending in the long run. The US will not become a resource dependent economy such as Russia or Venezuela, but these industries will have a substantial impact on the broader economy despite the fact that the US economy has become a services economy with a much lower ratio of energy consumption to output over time.
Taylor is aware of the environmental risks in the use of shale extraction technologies. He has also been an advocate of carbon taxes which internalize the external costs of carbon emissions.
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