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Estimates of the Price Elasticities of Natural Gas Supply and Demand in the United States

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  • Arora, Vipin

Abstract

I estimate short and long-run price elasticities of U.S. natural gas supply and demand. For robustness, the estimates are based on data of varying frequencies and samples, some of which include the recent U.S. shale gas boom. Aside from the numbers themselves, there are two main conclusions. As expected, U.S. price elasticities of natural gas supply are higher in both the short and long-run when the e�ffects of shale are included in the sample (post-2007). The calculated price elasticities of natural gas demand are also more responsive than recent estimates, but in-line with earlier ones.

Suggested Citation

  • Arora, Vipin, 2014. "Estimates of the Price Elasticities of Natural Gas Supply and Demand in the United States," MPRA Paper 54232, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:54232
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    References listed on IDEAS

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    More about this item

    Keywords

    Natural gas; sign restriction; shale; elasticity; long-run; short-run;
    All these keywords.

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • E37 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Forecasting and Simulation: Models and Applications
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices

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