The oil slick off the Louisiana cost is still expanding and is now approaching coastal marshes. The Coast Guard is now going to try to set fire to the slick in the hopes of dissipating the oil. Some commentators have (jokingly?) suggested that the US should simply nuke the slick and move on, like the [...]
[Previously: parts 1, 2, and 3.] Let’s talk about gasoline taxes. As I pointed out in previous posts, gasoline consumption is lowered only slightly by an increase in prices. While this makes it difficult to reduce consumption (and carbon dioxide emissions), it does give us the opportunity to raise an enormous amount of revenue. And [...]
[See preceding posts for more information.] After writing yesterday’s post, I decided to update my data to include the last quarter of 2009. This definitely changes things, as you can see from this graph: What makes these record-low consumption rates interesting is that they are not completely explained by high fuel prices. The same [...]
Using the equation I estimated yesterday, I decided to calculate the price elasticity of demand for gasoline. Price elasticity of demand is basically the responsiveness in a good’s consumption to a change in price. This number is (nearly) always negative, because the more expensive a good becomes, the less of it people buy. As the [...]
[Updated: I re-estimated this with daily consumption instead of monthly consumption for the simple reason that some months have more days than others. The F-score took a hit, but the model is more accurate, overall, I think.] I decided to play around with some of the stuff I’ve been learning in my econometrics class to [...]
