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Ethan Brown

Ethan Brown. The Texas Oil Boom and Its Future Texas Tech University. Introduction. Thesis:

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Ethan Brown

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  1. Ethan Brown The Texas Oil Boom and Its Future Texas Tech University

  2. Introduction • Thesis: • Though much of the research provides accurate explanations as to why there have been multiple busts accompanying the booms throughout the area’s history, new research has shown that the current Texas Oil Boom might not be followed by a bust this time around.

  3. Current research suggests many citizens living in the area around counties actively drilling for oil are extremely happy with the boom that has come out of the production. • Many citizens, like the ones mentioned from Sweetwater in Testa’s article and Eagle Ford in Parekh’s, are experiencing massive economic growth out of the boom. • This boom has not only stimulated the economy, but brought many jobs to the communities as well. • All seem to agree that this boom is a great thing and they aren’t going to make the same mistakes as the past that leads to busts.

  4. Recent studies show that multiple companies and individuals are being hurt by the recent oil boom that Texas has been witnessing. A large portion of these people even worry of another bust coming out of all the production as well as the state falling under what is known as the resource curse. • Witkowski explains the competition between banks and oil production companies over employees and how it is hurting both of them. • Testa mentions a bison rancher who is also suffering in a much different way. • Goldberg and Kellogg both provide a plausible cause for the issues behind Witkowski and Testa’s articles: The Resource Curse. • They claim that there isn’t enough money being put in by the state government to provide stabilization for citizens like the ones mentioned in the first two articles of the paragraph.

  5. Another major issue, research describes, lies in amounts of road damages caused across the state because of the boom in oil production. • Testamentions the amount/costs of road damages primarily caused by the amount of oil being trafficked throughout the state. • Burka elaborates on the amount of road damages mentioned by Testa and presents a possible reason why these roads have not been repaired. • He mentions the Economic Stabilization Fund and how much money is currently in it. Therefore backing up his argument that some of it should be used to repair these roads so Texas can remain a prosperous economic state, even though the state government refuses to use it.

  6. Although past research and case studies have suggested near economic downturn to follow the oil booms, current studies have shown that a large portion of individuals in Texas don’t predict a bust happening in the state’s future. • Goldberg provides multiple equations to explain why oil production will not be the reason the state’s economy falls, if such an event were to happen. • Hayward backs up why Goldberg doesn’t think the economy will fall, with a simpler approach: he gives information on the TX economy compared to other states like California and the US as a whole. • Brown provides estimated responses to a tax increase in oil extraction, further elaborating on the fact that Texas will still be in a much better position than any other state. • All agree that if Texas were to experience and economic recession, oil production would not be the cause for it.

  7. Conclusion • Although past research has concluded that oil production was indeed the cause for the past economic recessions, current research points out the major lack of evidence to support such a claim, and states that if such an economic downturn were to happen, it would not be caused by the amount of oil production going on in the state.

  8. Works Cited • Brown, Stephen P.A., and Mine K. Yucel. "The Shale Gas and Tight Oil Boom: U.S. States’ Economic Gain and Vulnerabilities." Council on Foreign Relations Press (2013): 5-8. Council On Foreign Relations. Alfred P. Sloan Foundation, Oct. 2013. Web. 22 June 2014. • Burka, Paul. "Road to Nowhere: Oil Money's Nice, But Actually Funding Our Infrastructure Needs Is Even Better." Texas Monthly 41.11 (2013): 28-35.Texas Monthly. Emmis Communications Corporation, Nov. 2013. Web. 14 June 2014. • Goldberg, Ellis et al. "Lessons from Strange Cases: Democracy, Development, and the Resource Curse in the U.S. States."Comparative Political Studies 41.4-5 (2008): 477-514. SagePub. Sage Publications, 14 May 2008. Web. 16 June 2014. • Hayward, Stephen F., and Kenneth P. Green. "Texas Energy and the Energy of Texas." Texas Public Policy Foundation (2011): 7-21. Texas Policy. American Enterprise Institute, 20 Jan. 2011. Web. 22 June 2014. • Kellogg, Ryan. "The Effect of Uncertainty on Investment: Evidence from Texas Oil Drilling." National Bureau of Economic Research (2010): 30-48. Openlink Fund, Nov. 2010. Web. 20 June 2014. • Parekh, Erin Nelsen. "Investment And Production Reach New Highs In Eagle Ford, Pipelines Lag Behind." Pipeline & Gas Journal 240.5 (2013): 38-42. Small Business Reference Center. Web. 22 June 2014. • TESTA, BRIDGET. "Home ON THE SHALES." Mechanical Engineering 135.12 (2013): 30-35. Military & Government Collection. Web. 22 June 2014. • Witkowski, Rachel. "Texas Oil Boom Starting To Worry Regulators." American Banker 179.76 (2014): 5. Business Source Complete. Web. 22 June 2014.

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