The Consequences of Increasing Fuel Prices on Car Travel and Household Budgets

Abstract

After decades of growth, average car use per adult suddenly levelled off during the 2000's. This break in trend resulted both from stabilized needs, with the ending transition of the way of life towards a mobility achieved by car, and from increasing financial constraints following the explosion of fuel prices. From a basic model based on motorization rates and an indicator of energetic purchasing power, we show that the stagnation of car travel can be viewed as a lagged reaction to rising fuel prices, the speed of adjustment reflecting the long-run adaptability of household behaviors. As a result of increasing fuel prices, a greater proportion of households has become financially vulnerable, with a higher risk of falling into energetic precarity. The risk has increased most where situations of vulnerability were already concentrated, namely in areas of diffuse urbanization and among low-income households.