Engel curves, household characteristics and low-user tariff schemes in natural gas
AbstractWe explore the relative importance of income and household characteristics (such as family size) in explaining differences in household consumption of natural gas and LPG. In a simple model of vertically (willingness to pay) ordered households we posit that the relative importance of the income elasticity of demand (vs. the family size elasticity) depends positively on the price faced by households. Thus, very low prices tend to depress the across households income elasticity of demand relative to the characteristic-elasticity and the opposite holds for under high prices. We test this hypothesis using, for the first time in Argentina, data from the household expenditure survey on Natural gas and LPG and compare the cross-consumption equations for both fuels, which have quite different price regimes. Finally, we explore welfare implications for low-user tariff scheme reforms in natural gas.
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Bibliographic InfoArticle provided by Elsevier in its journal Energy Economics.
Volume (Year): 31 (2009)
Issue (Month): 1 (January)
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Web page: http://www.elsevier.com/locate/eneco
Engel curves Natural gas consumption Social tariffs;
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- Fernando H. Navajas, 2006. "Estructuras Tarifarias Bajo Stress," Económica, Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata, vol. 0(1-2), pages 77-102, January-D.
- Navajas, Fernando H., 2008. "Infrastructure integration and incomplete contracts: natural gas in the Southern Cone," MPRA Paper 31025, University Library of Munich, Germany.
- Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, June.
- Phlips,Louis, 1983. "The Economics of Price Discrimination," Cambridge Books, Cambridge University Press, number 9780521283946, October.
- Cont, Walter & Hancevic, Pedro & Navajas, Fernando H., 2011. "Energy populism and household welfare," MPRA Paper 35725, University Library of Munich, Germany.
- Navajas, Fernando H. & Panadeiros, Monica & Natale, Oscar, 2011. "Environmentally Related Energy Taxes in Argentina, Bolivia and Uruguay," MPRA Paper 37829, University Library of Munich, Germany.
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