... high levels of inflation and unemployment; and balance of payments deficits. Also, there was a radical change in the management of western economies: the Keynesian demand strategy could not survive the magnitude of the oil crisis and was consequently abandoned in favour of Monetarism. This essay will argue that it was an unstable European economy with growing problems and the incapability to solve them that caused the decline in economic growth and that the oil-price rise of 1973 was the catalyst. There is a wide amount of commentary on the oil-price rise, and historians and economists differ on its impact or exact role during Europe's experience of recession between 1973 and 1979. It is important, therefore, to understand the function and position of oil before examining its impact on Western European economies. The western world and Japan from the 1950s increasingly became big importers of OPEC oil for sustaining their economic ...

See this essay or coursework document in full right now