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Redistributive Effects of Gasoline Prices

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  • Demet Yilmazkuday

    (Department of Economics, Florida International University)

  • Hakan Yilmazkuday

    (Department of Economics, Florida International University)

Abstract

Consumers face significantly different gasoline prices across gas stations. Using gasoline price data obtained from 98,753 gas stations within the U.S., it is shown that such differences can be explained by a model utilizing the gasoline demand of consumers depending on their income and commuting istance/time, where the pricing strategies of both gas stations and refiners are taken into account. The corresponding welfare analysis shows that there are significant redistributive effects of gasoline price changes among consumers, where the welfare costs of an increase in gasoline prices are found to be higher for lower income consumers.

Suggested Citation

  • Demet Yilmazkuday & Hakan Yilmazkuday, 2018. "Redistributive Effects of Gasoline Prices," Working Papers 1807, Florida International University, Department of Economics.
    • Handle: RePEc:fiu:wpaper:1807
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    Cited by:

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    3. Goldfarb, Jillian L. & Kriner, Douglas L., 2021. "U.S. public support for biofuels tax credits: Cost frames, local fuel prices, and the moderating influence of partisanship," Energy Policy, Elsevier, vol. 149(C).

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    More about this item

    Keywords

    Gasoline Prices; Gas-Station Level Analysis; United States;
    All these keywords.

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices

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