THE DEMAND FOR PETROL
Recent trends in the demand for petrol are analyzed using the technique of multiple regression. The alternative theories of demand are tested and appropriate explanatory equations are derived. The analysis pointed to three conclusions: consumers react to real and not nominal price changes; the petrol price elasticity is relatively small, even in the long run; and total consumer expenditure has a large impact on demand. It is shown that the impact of petrol prices on traffic levels will be less than that given by the petrol price elasticity. Since the latter has been found to be small, that impact will not be large. This relative lack of reaction to petrol price increases may indicate that motorists cannot readily divert to other modes of travel or forego journeys altogether. It is also pointed out that traffic forecasts will ultimately depend on the validity of the assumptions about trends in gross national product which underlie changes in consumer expenditure.
An Foras ForbarthaSt Martin's House, Waterloo Road
Dublin 4, Ireland
- Feeney, B P
- Publication Date: 1976-10
- Features: Appendices; Figures; References; Tables;
- Pagination: 17 p.
- TRT Terms: Consumers; Demand; Forecasting; Gross national product; Multiple regression analysis; Petroleum; Prices; Traffic density
- Old TRIS Terms: Multiple regression
- Subject Areas: Economics; Geotechnology; Highways; Society;
- Accession Number: 00148860
- Record Type: Publication
- Files: TRIS
- Created Date: Apr 27 1977 12:00AM