PRICE SENSITIVITY OF PETROL CONSUMPTION AND SOME POLICY IMPLICATIONS. THE CASE OF THE EEC

Using econometric and statistical techniques this study focuses on conserving energy by taxing petrol. On the basis of the empirical findings there is substantial evidence to support the following policy implications. If the purpose of taxation on petrol prices is to raise public revenue, then the insensitivity of petrol demand to price would guarantee a good tax yield. Furthermore a 'creeping' rise in taxation, as opposed to a sharp one, would be met with almost no consumer reaction. If, however, the objective is to restrain petrol consumption and thus conserve energy, then taxes imposed on petrol seem to be a sheer exploitation of the consumer. Our results point to the fact that in the near future petrol consumption is unlikely to respond negatively to small price increases. If conservation efforts are to be successful, they should be directed to the alternatives of more efficient engine design, imposing speed limits, manufacturing smaller cars, and such like. /Author/TRRL/

  • Availability:
  • Corporate Authors:

    IPC Science and Technology Press Limited

    IPC House, 32 High Street
    Guildford, Surrey  England 
  • Authors:
    • Kouris, G J
  • Publication Date: 1978-9

Language

  • English

Media Info

  • Features: Figures; References; Tables;
  • Pagination: p. 209-216
  • Serial:
    • Energy Policy
    • Volume: 6
    • Issue Number: 3
    • Publisher: Butterworth Scientific Limited
    • ISSN: 0301-4215

Subject/Index Terms

Filing Info

  • Accession Number: 00189202
  • Record Type: Publication
  • Source Agency: Transport and Road Research Laboratory (TRRL)
  • Files: ITRD, TRIS
  • Created Date: Apr 12 1979 12:00AM