IDEAS home Printed from https://ideas.repec.org/p/zbw/rwirep/401.html

How Full Is the tank? – Insights on Short-run Fuel Price Reactions from German Travel Diary Data

Author

Listed:
  • Ritter, Nolan
  • Schmidt, Christoph M.
  • Vance, Colin

Abstract

We provide evidence that motorists respond to short-run fluctuations in fuel prices at the gas pump and not on the road. Employing variants of censored panel regression to control for unobserved heterogeneity and censoring of the dependent variable, we find that the fuel price has a large and negative impact on the quantity of fuel purchased, but no significant impact on the subsequent distance driven per day until the next refill. Over the short-run, drivers thus appear to cope with high fuel prices by adjusting fuel purchases with each visit to the filling station, but without altering their daily mileage.

Suggested Citation

  • Ritter, Nolan & Schmidt, Christoph M. & Vance, Colin, 2013. "How Full Is the tank? – Insights on Short-run Fuel Price Reactions from German Travel Diary Data," Ruhr Economic Papers 401, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    • Handle: RePEc:zbw:rwirep:401
    DOI: 10.4419/86788456
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/70770/1/737504439.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.4419/86788456?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Espey, Molly, 1998. "Gasoline demand revisited: an international meta-analysis of elasticities," Energy Economics, Elsevier, vol. 20(3), pages 273-295, June.
    2. Robert W. Crandall, 1992. "Policy Watch: Corporate Average Fuel Economy Standards," Journal of Economic Perspectives, American Economic Association, vol. 6(2), pages 171-180, Spring.
    3. Alan Sule & Honoré Bo E. & Hu Luojia & Leth-Petersen Søren, 2014. "Estimation of Panel Data Regression Models with Two-Sided Censoring or Truncation," Journal of Econometric Methods, De Gruyter, vol. 3(1), pages 1-20, January.
    4. Adonis Yatchew & Joungyeo Angela No, 2001. "Household Gasoline Demand in Canada," Econometrica, Econometric Society, vol. 69(6), pages 1697-1709, November.
    5. Ritter, Nolan & Vance, Colin, 2013. "Do fewer people mean fewer cars? Population decline and car ownership in Germany," Transportation Research Part A: Policy and Practice, Elsevier, vol. 50(C), pages 74-85.
    6. Manuel Frondel & Colin Vance, 2009. "Do High Oil Prices Matter? Evidence on the Mobility Behavior of German Households," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 43(1), pages 81-94, May.
    7. repec:aen:journl:2008v29-01-a06 is not listed on IDEAS
    8. repec:aen:journl:2008v29-04-a07 is not listed on IDEAS
    9. Manuel Frondel & Jorg Peters & Colin Vance, 2008. "Identifying the Rebound: Evidence from a German Household Panel," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 145-164.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ritter, Nolan & Schmidt, Christoph M. & Vance, Colin, 2016. "Short-run fuel price responses: At the pump and on the road," Energy Economics, Elsevier, vol. 58(C), pages 67-76.
    2. Nolan Ritter & Christoph M. Schmidt & Colin Vance, 2013. "How Full Is the tank? – Insights on Short-run Fuel Price Reactions from German Travel Diary Data," Ruhr Economic Papers 0401, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    3. Tilov, Ivan & Weber, Sylvain, 2023. "Heterogeneity in price elasticity of vehicle kilometers traveled: Evidence from micro-level panel data," Energy Economics, Elsevier, vol. 127(PA).
    4. Manuel Frondel & Colin Vance, 2018. "Drivers’ response to fuel taxes and efficiency standards: evidence from Germany," Transportation, Springer, vol. 45(3), pages 989-1001, May.
    5. Frondel, Manuel & Vance, Colin, 2013. "Fuel Taxes versus Efficiency Standards – An Instrumental Variable Approach," Ruhr Economic Papers 445, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    6. Dimitropoulos, Alexandros & Oueslati, Walid & Sintek, Christina, 2018. "The rebound effect in road transport: A meta-analysis of empirical studies," Energy Economics, Elsevier, vol. 75(C), pages 163-179.
    7. Arpita Asha Khanna & Ilka Dubernet & Patrick Jochem, 2025. "Do car drivers respond differently to fuel price changes? Evidence from German household data," Transportation, Springer, vol. 52(2), pages 579-613, April.
    8. Vance, Colin & Frondel, Manuel, 2015. "From fuel taxation to efficiency standards: A wrong turn in European climate protection?," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113171, Verein für Socialpolitik / German Economic Association.
    9. Broberg, Thomas, 2014. "Relative income and the WTP for public goods - A case study of forest conservation in Sweden," CERE Working Papers 2014:6, CERE - the Center for Environmental and Resource Economics.
    10. Manuel Frondel & Colin Vance, 2013. "Fuel Taxes versus Efficiency Standards – An Instrumental Variable Approach," Ruhr Economic Papers 0445, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    11. Frondel, Manuel & Vance, Colin, 2013. "Re-Identifying the Rebound: What About Asymmetry?," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 34(4), pages 42-54.
    12. Stela Rubínová, 2011. "Reakce poptávky domácností po energii na zvyšování energetické účinnosti: teorie a její důsledky pro konstrukci empiricky ověřitelných modelů [Reaction of Household Energy Demand to Improvements in Energy Efficiency: Theory and Its Implications fo," Politická ekonomie, Prague University of Economics and Business, vol. 2011(3), pages 359-378.
    13. Mohammad Vesal & Amir Hossein Tavakoli & Mohammad H. Rahmati, 2022. "What do one hundred million transactions tell us about demand elasticity of gasoline?," Empirical Economics, Springer, vol. 62(6), pages 2693-2711, June.
    14. Radchenko, Stanislav & Tsurumi, Hiroki, 2006. "Limited information Bayesian analysis of a simultaneous equation with an autocorrelated error term and its application to the U.S. gasoline market," Journal of Econometrics, Elsevier, vol. 133(1), pages 31-49, July.
    15. Liu, Weiwei, 2014. "Modeling gasoline demand in the United States: A flexible semiparametric approach," Energy Economics, Elsevier, vol. 45(C), pages 244-253.
    16. Frondel, Manuel & Vance, Colin, 2009. "On Marginal and Interaction Effects: The Case of Heckit and Two-Part Models," Ruhr Economic Papers 138, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    17. Frondel, Manuel & Vance, Colin, 2010. "Fixed, random, or something in between? A variant of Hausman's specification test for panel data estimators," Economics Letters, Elsevier, vol. 107(3), pages 327-329, June.
    18. Frondel, Manuel & Ritter, Nolan & Vance, Colin, 2012. "Heterogeneity in the rebound effect: Further evidence for Germany," Energy Economics, Elsevier, vol. 34(2), pages 461-467.
    19. Chen, Haotian & Smyth, Russell & Zhang, Xibin, 2017. "A Bayesian sampling approach to measuring the price responsiveness of gasoline demand using a constrained partially linear model," Energy Economics, Elsevier, vol. 67(C), pages 346-354.
    20. Montag, Josef, 2015. "The simple economics of motor vehicle pollution: A case for fuel tax," Energy Policy, Elsevier, vol. 85(C), pages 138-149.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:rwirep:401. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/rwiesde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.