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Implication of Fuel Price Deregulation on Fuel Demand and CO2 Emission: A Case Study of Car Ownership and Utilisation in India

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  • Bandyopadhyay, Kaushik Ranjan

Abstract

India’s road transport is characterised by a historical asymmetry in the auto-fuel prices due to lack of parity between international and domestic fuel prices and artificial deflation of domestic diesel price relative to that of petrol through differences in levies. This continued to provide a constant fillip to ownership and utilisation of personalised vehicles leading to higher energy consumption with negative spill-over on the environment. In this backdrop, the paper builds up a time series econometric model of car ownership and utilisation in India and examines the possible implication of price-deregulation and removal of price asymmetry between petrol and diesel for future energy saving and curtailment of CO2 emissions for an on-road car.

Suggested Citation

  • Bandyopadhyay, Kaushik Ranjan, 2008. "Implication of Fuel Price Deregulation on Fuel Demand and CO2 Emission: A Case Study of Car Ownership and Utilisation in India," MPRA Paper 25641, University Library of Munich, Germany, revised 2009.
    • Handle: RePEc:pra:mprapa:25641
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    References listed on IDEAS

    as
    1. Robert S. Pindyck, 1979. "The Structure of World Energy Demand," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262661772, December.
    2. Singh, Sanjay Kumar, 2006. "Future mobility in India: Implications for energy demand and CO2 emission," Transport Policy, Elsevier, vol. 13(5), pages 398-412, September.
    3. Sperling, Daniel & Salon, Deborah, 2002. "Transportation in Developing Countries: An Overview of Greenhouse Gas Reduction Strategies," University of California Transportation Center, Working Papers qt0cg1r4nq, University of California Transportation Center.
    4. Gebhard Kirchgässner & Jürgen Wolters & Uwe Hassler, 2013. "Introduction to Modern Time Series Analysis," Springer Texts in Business and Economics, Springer, edition 2, number 978-3-642-33436-8, August.
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    More about this item

    Keywords

    transport; fuel prices; fuel consumption; CO2 emissions;
    All these keywords.

    JEL classification:

    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics

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