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Are Us Gasoline Price Adjustments Asymmetric?

Author

Listed:
  • B Bhaskara Rao

    (University of the South Pacific)

  • Gyaneshwar Rao

    (University of the South Pacific)

Abstract

We use the LSE-Hendry general to specific approach to analyse if US gasoline price adjustments are asymmetric with respect to changes in crude oil prices. Furthermore, we modify some weaknesses in the earlier works by Boreinstein, Cameron and Gilbert (1997) and Bachmeier and Griffin (2003) and shows that if the price adjustment equations are properly specified and estimated, alternative specifications and temporal aggregation of data do not affect the results. Monthly US data are used to show that alternative specifications give equally good results and there is no asymmetry in the US gasoline price adjustments.

Suggested Citation

  • B Bhaskara Rao & Gyaneshwar Rao, 2005. "Are Us Gasoline Price Adjustments Asymmetric?," Microeconomics 0510001, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpmi:0510001
    Note: Type of Document - pdf; pages: 9
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    References listed on IDEAS

    as
    1. Granger, Clive W J, 1997. "On Modelling the Long Run in Applied Economics," Economic Journal, Royal Economic Society, vol. 107(440), pages 169-177, January.
    2. Severin Borenstein & A. Colin Cameron & Richard Gilbert, 1997. "Do Gasoline Prices Respond Asymmetrically to Crude Oil Price Changes?," The Quarterly Journal of Economics, Oxford University Press, vol. 112(1), pages 305-339.
    3. B Bhaskara Rao & Gyaneshwar Rao, 2005. "Crude Oil and Gasoline Prices in Fiji: Is the Relationship Asymmetric?," Microeconomics 0510004, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Karagiannis, Stelios & Panagopoulos, Yannis & Vlamis, Prodromos, 2015. "Are unleaded gasoline and diesel price adjustments symmetric? A comparison of the four largest EU retail fuel markets," Economic Modelling, Elsevier, vol. 48(C), pages 281-291.
    2. Szymon Wlazlowski & Monica Giulietti & Jane Binner & Costas Milas, 2011. "Price Transmission in the EU Wholesale Petroleum Markets," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 30(2), pages 165-172, January.
    3. Aboura, Sofiane & Chevallier, Julien, 2017. "Oil vs. gasoline: The dark side of volatility and taxation," Research in International Business and Finance, Elsevier, vol. 39(PB), pages 976-989.
    4. Koutroumanidis, Theodoros & Zafeiriou, Eleni & Arabatzis, Garyfallos, 2009. "Asymmetry in price transmission between the producer and the consumer prices in the wood sector and the role of imports: The case of Greece," Forest Policy and Economics, Elsevier, vol. 11(1), pages 56-64, January.
    5. repec:eee:riibaf:v:44:y:2018:i:c:p:459-470 is not listed on IDEAS
    6. Karagiannis, Stelios & Panagopoulos, Yannis & Vlamis, Prodromos, 2010. "Interest rate pass-through in Europe and the US: Monetary policy after the financial crisis," Journal of Policy Modeling, Elsevier, vol. 32(3), pages 323-338, May.
    7. Ioanna Reziti & Yannis Panagopoulos, 2008. "Asymmetric price transmission in the greek agri-food sector: some tests," Agribusiness, John Wiley & Sons, Ltd., vol. 24(1), pages 16-30.
    8. Chattopadhyay, Manojit & Kumar Mitra, Subrata, 2015. "Exploring asymmetric behavior pattern from Indian oil products prices using NARDL and GHSOM approaches," Energy Policy, Elsevier, vol. 86(C), pages 262-272.
    9. Szymon Wlazlowski & Monica Giulietti & Jane Binner & Costas Milas, 2008. "Smooth Transition Models in Price Transmission," Working Paper series 04_08, Rimini Centre for Economic Analysis.
    10. Perdiguero-GarcĂ­a, Jordi, 2013. "Symmetric or asymmetric oil prices? A meta-analysis approach," Energy Policy, Elsevier, vol. 57(C), pages 389-397.

    More about this item

    Keywords

    Asymmetric price adjustments; Market power; General to specific approach; Error correction models and Gasoline and crude oil prices;

    JEL classification:

    • P - Economic Systems
    • Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics
    • Z - Other Special Topics

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