Oil prices set by OPEC (1973) and Popperean economic epistemology

The unilateral fixing of fiscal reference prices by six OPEC member countries on October 17, 1973 was one of the most crucial economic developments in international oil and economic history. Economic theory was forced to conceive of an unprecedented construct such as stagflation as a conceptual representation of the economic fact (also unprecedent) of inflation accompanied by unemployment. Heretwo rival interpretations of this event are examined and the successes and failures of the logical contents of two rival theories (the microeconomic and the income theory) are explained from the Popperean epistemology.