Cited by 668Energy, Environment, and Transportation PoliciesTransportation Planning and OptimizationEconomics of Agriculture and Food Markets

Evidence of a Shift in the Short-Run Price Elasticity of Gasoline Demand

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Hughes, Jonathan E., Knittel, Christopher R., Sperling, Daniel·2008·The Energy Journal

Abstract

Understanding the sensitivity of gasoline demand to changes in prices and income has important implications for policies related to climate change, optimal taxation and national security. The short-run price and income elasticities of gasoline demand in the United States during the 1970s and 1980s have been studied extensively. However, transportation analysts have hypothesized that behavioral and structural factors over the past several decades have changed the responsiveness of U.S. consumers to changes in gasoline prices. We compare the price and income elasticities of gasoline demand in two periods of similarly high prices from 1975 to 1980 and 2001 to 2006. The short-run price elasticities differ considerably: and range from -0.034 to -0.077 during 2001 to 2006, versus -0.21 to -0.34 for 1975 to 1980. The estimated short-run income elasticities range from 0.21 to 0.75 and when estimated with the same models are not significantly different between the two periods.

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  1. Banerjee, N. (2002). "Venezuela Strife Pushes Crude Oil to $30." The New York Times. Late Edition -Final. C 1. December 17, 2002.
  2. Kahn, M. E. (2000). "The Environmental Impact of Suburbanization." Journal of Policy Analysis and Management 19(4): 569-586.
  3. Mouawad, J. and Bajaj, V. (2005). "Gulf Oil Operations Remain in Disarray." The New York Times. Late Edition -Final. C 1. September 2, 2005.
  4. Polzin, S. E. and Chu, X. (2005). "A Closer Look at Public Transportation Mode Share Trends." Journal of Transportation and Statistics 8(3): 41-53.

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Authors
Hughes, J. E., Knittel, C. R., & Sperling, D.
Affiliations
  • University of Colorado Boulder (US)
  • National Bureau of Economic Research (US)
  • * Institute of Transportation Studies, University of California, Davis, One Shields Avenue, Davis, CA 95616. Email: jehughes@ucdavis.edu.
Corresponding author
Hughes, Jonathan E.
Venue
The Energy Journal
Published
2008-01
Volume
29
Issue
1
Pages
113-134
ISSN
  • 0195-6574 (ISSN-L)
  • 1944-9089
OpenAlex
W3023760385
Cited by
668
References
23
Citations by year
2026: 13 · 2025: 13 · 2024: 17 · 2023: 21 · 2022: 19 · 2021: 32 · 2020: 27 · 2019: 22 · 2018: 34 · 2017: 29 · 2016: 48 · 2015: 45 · 2014: 43 · 2013: 53 · 2012: 57
FWCI
23.76
Type
journal article
Language
en
Open access
Locations
  • The Energy Journal (publishedVersion)
  • SSRN Electronic Journal (publishedVersion)
  • National Bureau of Economic Research (publishedVersion)
  • RePEc: Research Papers in Economics (submittedVersion)
  • eScholarship (California Digital Library) (submittedVersion)
  • National Bureau of Economic Research (submittedVersion)
  • Econstor (Econstor) (submittedVersion)
Topics
  • Physical Sciences › Energy › Renewable Energy, Sustainability and the Environment › Energy, Environment, and Transportation Policies
  • Social Sciences › Transportation › Transportation Planning and Optimization
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economics of Agriculture and Food Markets
Keywords
gasoline consumption, price elasticity, income elasticity, temporal comparison, United States

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