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Gasoline demand in Europe: New insights

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  • Pock, Markus

Abstract

This study utilizes a panel data set from 14 European countries over the period 1990-2004 to estimate a dynamic model specification for gasoline demand. Previous studies estimating gasoline consumption per total passenger cars ignore the recent increase in the number of diesel cars in most European countries leading to biased elasticity estimates. We apply several common dynamic panel estimators to our small sample. Results show that specifications neglecting the share of diesel cars overestimate short-run income, price and car ownership elasticities. It appears that the results of standard pooled estimators are more reliable than common IV/GMM estimators applied to our small data set.

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  • Pock, Markus, 2010. "Gasoline demand in Europe: New insights," Energy Economics, Elsevier, vol. 32(1), pages 54-62, January.
  • Handle: RePEc:eee:eneeco:v:32:y:2010:i:1:p:54-62
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    Cited by:

    1. Hugh Hennessy & Richard S. J. Tol, 2011. "The Impact of Government Policy on Private Car Ownership in Ireland," The Economic and Social Review, Economic and Social Studies, vol. 42(2), pages 135-157.
    2. Broadstock, David C. & Hunt, Lester C., 2010. "Quantifying the impact of exogenous non-economic factors on UK transport oil demand," Energy Policy, Elsevier, vol. 38(3), pages 1559-1565, March.
    3. González, Rosa Marina & Marrero, Gustavo A., 2012. "The effect of dieselization in passenger cars emissions for Spanish regions: 1998–2006," Energy Policy, Elsevier, vol. 51(C), pages 213-222.
    4. repec:eee:transa:v:106:y:2017:i:c:p:22-50 is not listed on IDEAS
    5. de Freitas, Luciano Charlita & Kaneko, Shinji, 2011. "Ethanol demand in Brazil: Regional approach," Energy Policy, Elsevier, vol. 39(5), pages 2289-2298, May.
    6. Brueckner, Jan K. & Proost, Stef, 2010. "Carve-outs under airline antitrust immunity," International Journal of Industrial Organization, Elsevier, pages 657-668.
    7. Hennessy, Hugh & Tol, Richard S.J., 2011. "The impact of tax reform on new car purchases in Ireland," Energy Policy, Elsevier, pages 7059-7067.
    8. Liddle, Brantley, 2012. "The Systemic, Long-run Relation among Gasoline Demand, Gasoline Price, Income, and Vehicle Ownership in OECD Countries: Evidence from Panel Cointegration and Causality Modeling," MPRA Paper 52081, University Library of Munich, Germany.
    9. Tomáš Havránek & Zuzana Iršová & Karel Janda, 2011. "Demand for Gasoline Is More Price-Inelastic than Commonly Thought," Working Papers IES 2011/10, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Mar 2011.
    10. Baranzini, Andrea & Weber, Sylvain, 2013. "Elasticities of gasoline demand in Switzerland," Energy Policy, Elsevier, vol. 63(C), pages 674-680.
    11. Wadud, Zia, 2016. "Diesel demand in the road freight sector in the UK: Estimates for different vehicle types," Applied Energy, Elsevier, pages 849-857.
    12. Havranek, Tomas & Irsova, Zuzana & Janda, Karel, 2012. "Demand for gasoline is more price-inelastic than commonly thought," Energy Economics, Elsevier, pages 201-207.
    13. Hennessy, Hugh & Tol, Richard S. J., 2010. "The Impact of Climate Policy on Private Car Ownership in Ireland," Papers WP342, Economic and Social Research Institute (ESRI).
    14. Melo, Patricia C. & Ramli, Ahmad Razi, 2014. "Estimating fuel demand elasticities to evaluate CO2 emissions: Panel data evidence for the Lisbon Metropolitan Area," Transportation Research Part A: Policy and Practice, Elsevier, vol. 67(C), pages 30-46.
    15. Neto, David, 2012. "Testing and estimating time-varying elasticities of Swiss gasoline demand," Energy Economics, Elsevier, pages 1755-1762.
    16. Adewuyi, Adeolu O., 2016. "Determinants of import demand for non-renewable energy (petroleum) products: Empirical evidence from Nigeria," Energy Policy, Elsevier, vol. 95(C), pages 73-93.
    17. Mohcine Bakhat & José M. Labeaga & Xavier Labandeira & Xiral Lñpez, 2013. "Economic Crisis and Elasticities of Car Fuels: Evidence for Spain," Working Papers fa15-2013, Economics for Energy.
    18. Havranek, Tomas & Irsova, Zuzana & Janda, Karel, 2012. "Demand for gasoline is more price-inelastic than commonly thought," Energy Economics, Elsevier, pages 201-207.
    19. Wittmann, Nadine, 2014. "Regulating gasoline retail markets: The case of Germany," Economics Discussion Papers 2014-17, Kiel Institute for the World Economy (IfW).
    20. Arzaghi, Mohammad & Squalli, Jay, 2015. "How price inelastic is demand for gasoline in fuel-subsidizing economies?," Energy Economics, Elsevier, pages 117-124.
    21. Fullerton, Thomas M., Jr. & Munoz Sapien, Gabriel & Barraza de Anda, Martha P. & Dominguez Ruvalcaba, Lisbeily, 2011. "Dinámica del Consumo de Gasolina en Ciudad Juárez, Chihuahua
      [Gasoline Consumption Dynamics in Ciudad Juárez, Chihuahua]
      ," MPRA Paper 46853, University Library of Munich, Germany, revised 15 Jun 2012.
    22. David Oliveira & Isabel Mendes, 2017. "Green Taxation on Competitiveness: The Effect of the ISP Tax on the Portuguese Retail Sector of Road Fuels," International Journal of Energy Economics and Policy, Econjournals, pages 178-184.
    23. Bigerna, S. & Bollino, C.A. & Micheli, S. & Polinori, P., 2017. "Revealed and stated preferences for CO2 emissions reduction: The missing link," Renewable and Sustainable Energy Reviews, Elsevier, vol. 68(P2), pages 1213-1221.
    24. Salisu, Afees A. & Ayinde, Taofeek O., 2016. "Modeling energy demand: Some emerging issues," Renewable and Sustainable Energy Reviews, Elsevier, vol. 54(C), pages 1470-1480.
    25. Filippini, Massimo & Heimsch, Fabian, 2016. "The regional impact of a CO2 tax on gasoline demand: A spatial econometric approach," Resource and Energy Economics, Elsevier, vol. 46(C), pages 85-100.

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