Differential demand response to gasoline taxes and gasoline prices in the U.S.

Tiezzi, Silvia; Verde, Stefano F.

doi:10.1016/j.reseneeco.2016.02.003

Cited by 32 publications

(30 citation statements)

References 47 publications

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“…For other countries, the substitutability of energy items appears to be very context specific, as the findings in the empirical literature demonstrate. Tiezzi and Verde (2016) find complementarity between electricity and gasoline for the United States, while Nikodinoska and Schröder (2016) find the opposite for Germany.…”

Section: Estimation Resultsmentioning

confidence: 95%

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The Effects of Energy Price Changes: Heterogeneous Welfare Impacts, Energy Poverty, and CO2 Emissions in Indonesia

2017

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. We study the welfare, energy poverty, and CO2 emission implications of energy price change scenarios in Indonesia. Our analysis extends previous analyses of energy price impacts at the household level in several ways. First, by employing a household energy demand system (QUAIDS), we are able to distinguish between first-and second-order welfare effects over the income distribution. Our analysis shows considerable heterogeneity of welfare impacts. For gasoline and electricity, first-order calculations overestimate welfare effects by 10 to 20 per cent for price changes between 20 and 50 per cent. Second, our results point to the ownership of energy-processing durables as another source of impact heterogeneity. Poor households that own these goods may be hit particularly strongly by energy price increases. Third, we extend the welfare analysis beyond the money-metric utility effects and look at energy poverty, which is understood as the absence of or imperfect access to reliable and clean modern energy services. Drawing on the estimated demand function, we find that price increases have substantial effects on energy poverty. Terms of use: Documents inFourth, our analysis explicitly considers the emissions effects of energy price scenarios. We find that reduced household energy demand implies a substantial reduction in emissions.The analysis thus indicates that energy prices may serve as an effective mitigation instrument but also have important adverse welfare effects. The latter can, however, be mitigated by appropriate compensation policies.

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Section: Estimation Resultsmentioning

confidence: 95%

“…Since the seminal work of Stone (1954) (2016), and Tiezzi and Verde (2016). To our knowledge, no demand system specification of this form has so far been applied to the energy context in low-and middleincome countries.…”

Section: Demand Systemmentioning

confidence: 99%

The Effects of Energy Price Changes: Heterogeneous Welfare Impacts, Energy Poverty, and CO2 Emissions in Indonesia

2017

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“…Kayser [46] investigated the USA case and concluded that taxes on gasoline had an important effect on the decrease of gasoline demand. Tiezzi and Verde [47], Coglianese et al [5], Rivers and Schaufele [48] and Filippini and Heimsch [49] also examined the issues affecting gasoline demand in different countries. It was concluded that tax rate had a statistically significant effect on gasoline demand.…”

Section: Literature Review On Gasoline Demandmentioning

confidence: 99%

Elasticity Analysis of Fossil Energy Sources for Sustainable Economies: A Case of Gasoline Consumption in Turkey

et al. 2020

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The current paper investigates the gasoline demand relationship in the case of Turkey, utilizing different econometric techniques and using quarterly data spanning from 2000Q1 to 2019Q1. The estimation results revealed that income and gasoline price are the main drivers of consumption. The found long-run income, price and auto stock elasticities are 0.25, −0.27 and −0.80, respectively. In addition, it is concluded that in the short-run, gasoline demand does not respond to changes in income, price and car stock. The estimation results also showed that the contribution of commercial and public car stock on gasoline demand is higher than that for private auto stock. Based on the finding of the study it is concluded that to achieve the optimal use of gasoline in line with providing high quality transport services, firstly, policies before the 2012 period can be followed. Secondly, channels such as pricing mechanism and taxation policies can be used in this framework.

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“…For our analysis we use the Quadratic Almost Ideal Demand System (QUAIDS) framework (Banks et al 1997), since observed Engel curves appear to be well approximated by a quadratic relationship between budget shares and logarithmic transformed expenditures. 3 The estimation of a QUAIDS has been applied to the energy context by Bränn-lund and Nordström (2004) for Sweden, Labandeira et al (2006) for Spain, Nikodinoska and Schröder (2016) for Germany, and Tiezzi and Verde (2016) for the United States, but according to our knowledge, no demand system specification of this type has been applied to the energy context in low-and middle-income countries to date. 4 As a rank three quadratic logarithmic budget share system, the QUAIDS has an indirect utility function that takes the following form:…”

Section: Demand Systemmentioning

confidence: 99%

Household welfare and CO2 emission impacts of energy and carbon taxes in Mexico

2018

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Household Welfare and CO2 Emission Impacts of Energy and Carbon Taxes in Mexico AbstractWe analyse the effects of environmental taxes on welfare and carbon emissions at the household level for the case of Mexico. The integrated welfare-environmental analysis, which is based on a censored energy consumer demand system, extends previous work in two ways. First, the estimation of a full matrix of substitution elasticities allows us to test the necessity of incorporating second-order effects into the welfare analysis. Second, the substitution elasticities derived from the demand system are used to estimate the shortrun CO2 emission-reduction potential. We find that first-order approximations of welfare effects provide reasonable estimates, particularly for carbon taxes. Analog to evidence in other low-and middle-income countries, the taxation of all energy items is found to be regressive, with the exception of motor fuels. The inclusion of CH4 and N2O in a carbon tax regime comes with particularly regressive impacts because of its strong effects on food prices. The analysis of the emission implications of different tax scenarios indicates that short-run emission reductions at the household level can be substantial -though the effects depend on how revenue is recycled. This effectiveness combined with moderate and manageable adverse distributional impacts renders the carbon tax a preferred mitigation instrument. Considering the large effect of food price increases on poverty and the limited additional emission-saving potential, the inclusion of CH4 and N2O in a carbon tax regime is not advisable.

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Differential demand response to gasoline taxes and gasoline prices in the U.S.

Cited by 32 publications

References 47 publications

The Effects of Energy Price Changes: Heterogeneous Welfare Impacts, Energy Poverty, and CO2 Emissions in Indonesia

The Effects of Energy Price Changes: Heterogeneous Welfare Impacts, Energy Poverty, and CO2 Emissions in Indonesia

Elasticity Analysis of Fossil Energy Sources for Sustainable Economies: A Case of Gasoline Consumption in Turkey

Household welfare and CO2 emission impacts of energy and carbon taxes in Mexico

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