THE PRICING OF AND DEMAND FOR GASOLINE: A SURVEY OF MODELS

In an age when concern for ecological issues such as global warming is rapidly mounting, attention is naturally focused on the use of transport fuels. Highway (and air) transport accounts for an increasing share of oil consumption and savings appear to be both technically and socially harder to achieve than in many other sectors where substitutes may be more easily available. Large sums of money are invested in trying to improve efficiency of specific components (such as vehicles) or whole transport systems. It is therefore of particular interest to study the economics for the transport fuel market and thereby to evaluate the efficiency of the price mechanism as an instrument of policy in this area. Such studies can help us unravel the determinants of gasoline consumption with the dual purpose of forecasting demand under various scenarios and of assessing the effect of various policy proposals such as gasoline taxes. This is an area in which very much research has already been carried out and with sometimes apparently conflicting results. The task we have set ourselves in this paper is therefore not only to survey earlier results but also to provide something like a handbook of gasoline modelling. The work is subdivided into three chapters. After a brief introduction to pricing and consumption patterns in various countries, chapter two explains the economics of the transport fuel market and compares the different approaches available to model it. Chapter three is a detailed survey and analysis of earlier elasticity estimates. Instead of simply accounting for earlier studies our ambition has been to relate the results obtained to the type of model used and thereby to analyse the effects of model choice. (A)

  • Corporate Authors:

    Goeteborgs Universitet

    Foeretagsekonomiska Institutionen, Vasagatan 3
    Goeteborg,   Sweden 
  • Authors:
    • DAHL, C
    • STERNER, T
  • Publication Date: 1990

Language

  • English

Media Info

Subject/Index Terms

Filing Info

  • Accession Number: 00607028
  • Record Type: Publication
  • Source Agency: Transport and Road Research Laboratory (TRRL)
  • Files: ITRD, TRIS
  • Created Date: Mar 31 1991 12:00AM