The boom in oil and gas production in the United States has largely been heralded as a strong economic stimulus for the economy. For example, in an August 2013 interview, McKinsey partner Scott Nyquist outlined huge economic returns through increases in capital investment and jobs in the manufacturing sector. “This is an exciting game changer for the US economy,” said Nyquist. “It can create jobs through investment in the energy sector itself and through the ripple effects in other parts of the economy. It will increase the overall GDP of the country, which will increase the overall wealth and well-being of many of its citizens.”

In contrast to this view, a new book released by the Peterson Institute, “Fueling Up: The Economic Implications of America’s Oil and Gas Boom,” describes a different economic impact, at least in the long-term. Authors Trevor Houser and Shashank Mohan conclude that while the current energy boom is increasing employment, reducing energy costs, and boosting the manufacturing industry in the short-term, in the long-term these positive effects to the economy will be much more modest. Houser and Mohan describe the energy boom’s effect on the U.S economy as “a one-time positive shock to the economy, not a sustained increase in the rate of growth.”

How will the domestic oil and natural gas boom impact the economy over the short term and long term? How should policymakers value short-term vs. long-term economic benefits when making policy decisions?