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Crude Oil and Gasoline Prices in Fiji: Is the Relationship Asymmetric?

Author

Listed:
  • B Bhaskara Rao

    (University of the South Pacific)

  • Gyaneshwar Rao

    (University of the South Pacific)

Abstract

This paper tests and confirms asymmetry in the Fiji gasoline price adjustment equations with respect to changes in the crude oil prices. More satisfactory specifications and estimation are used than in the earlier studies. It is found that two alternative approaches viz., the Granger two-step and the LSE-Hendry general to specific approaches, give similar results. Our results show that oil firms in Fiji seem to adjust gasoline prices twice faster than decrease them.

Suggested Citation

  • B Bhaskara Rao & Gyaneshwar Rao, 2005. "Crude Oil and Gasoline Prices in Fiji: Is the Relationship Asymmetric?," Microeconomics 0510004, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpmi:0510004
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    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/mic/papers/0510/0510004.pdf
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    References listed on IDEAS

    as
    1. Kevin D. Hoover & Stephen J. Perez, 1999. "Data mining reconsidered: encompassing and the general-to-specific approach to specification search," Econometrics Journal, Royal Economic Society, vol. 2(2), pages 167-191.
    2. Bacon, Robert W., 1991. "Rockets and feathers: the asymmetric speed of adjustment of UK retail gasoline prices to cost changes," Energy Economics, Elsevier, vol. 13(3), pages 211-218, July.
    3. Lance J. Bachmeier & James M. Griffin, 2003. "New Evidence on Asymmetric Gasoline Price Responses," The Review of Economics and Statistics, MIT Press, vol. 85(3), pages 772-776, August.
    4. Severin Borenstein & A. Colin Cameron & Richard Gilbert, 1997. "Do Gasoline Prices Respond Asymmetrically to Crude Oil Price Changes?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(1), pages 305-339.
    5. Nathan S. Balke & Stephen P. A. Brown & Mine K. Yücel, 1998. "Crude oil and gasoline prices: an asymmetric relationship?," Economic and Financial Policy Review, Federal Reserve Bank of Dallas, issue Q 1, pages 2-11.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. B. Bhaskara Rao & Gyaneshwar Rao, 2008. "Are US gasoline price adjustments asymmetric?," Applied Economics Letters, Taylor & Francis Journals, vol. 15(6), pages 443-447.
    2. Perdiguero-García, Jordi, 2013. "Symmetric or asymmetric oil prices? A meta-analysis approach," Energy Policy, Elsevier, vol. 57(C), pages 389-397.
    3. Jordi Perdiguero-García, 2010. "“Symmetric or asymmetric gasoline prices? A metaanalysis approach”," IREA Working Papers 201013, University of Barcelona, Research Institute of Applied Economics, revised Nov 2010.
    4. Rao, Gyaneshwar, 2008. "The Relationship between Crude and Refined Product Market: The Case of Singapore Gasoline Market using MOPS Data," MPRA Paper 7579, University Library of Munich, Germany.
    5. 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.

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    More about this item

    Keywords

    Crude Oil and Gasoline Prices; Asymmetric Price Response; Rockets and Feathers Hypothesis; Granger Two-Step Estimation; the LSE- Hendry General to Specific Approach.;
    All these keywords.

    JEL classification:

    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • C8 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs

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