Title: Social Costs of Energy Disruptions
Authors: Valeria Costantini and Francesco Gracceva
URL: http://www.feem.it/userfiles/attach/Publication/NDL2004/NDL2004-116.pdf

Oil shortages do not just impact the economy, social impacts of oil distribution disruptions can also be very severe. This article is aimed at examining the social costs of oil supply disruptions in order to better understand how people can deal with such a crisis. The article pulls on past oil crisis that lead to drastically increased inflation, trade imbalances, high unemployment, and weak business.

Generally speaking oil supply disruptions have been the result of political or military upheavals, particularly in the Middle East. These have resulted in a transfer of trade power and income from the importers to the exporters. These are known as oil shocks that categorize into notable price change, quantity, and technology change.

There is a direct correlation between crude oil prices and the high unemployed rates in a given country. Depending on the systems that the government has in place a sudden oil shock could mean that lower-income households suffer the bulk of the negative social impacts. Whereas those who are more middle class are not as effected. Since oil demand is so inelastic, when there is a big oil shock such as the one in 1978 a country's entire GDP can be dropped down significantly.

In order to avoid these higher costs people begin carpooling much more. Also another solution that is becoming more common is when looking for a new car, buy something with good gas mileage. Public transportation should also be utilized more frequently when there is a large increase in oil prices. These things will all help to lessen in the social impacts felt whenever there is a disruption in the oil supply that causes a spike in prices.