Income and price elasticities and oil‐saving technological changes in ARDL models of demand for oil in G7 and BRIC

Asali, Mehdi

doi:10.1111/j.1753-0237.2011.00193.x

Cited by 7 publications

(4 citation statements)

References 11 publications

(13 reference statements)

Supporting

Mentioning

Contrasting

Order By: Relevance

“…For instance, on the aspect of price substitution an important study by Mazraati and Shelbi (2011) contend that in the context of GHG and ecological issues, there is little to expect that the policy of alternative fuels and alternative fuel vehicles (AFVs) may bring such results, unless sustainable levels of high oil prices are reached. A similar conclusion was reached by Asali (2011) in the analysis of the G-7 and BRIC economies.…”

Section: Oil Price/ Energy Consumption Income and Emissions Nexussupporting

confidence: 79%

Environmental implications of increased US oil production and liberal growth agenda in post -Paris Agreement era

Shahbaz

Kablan

Hammoudeh

et al. 2020

Journal of Environmental Management

View full text Add to dashboard Cite

Contextualising on the internationally low oil prices era and historically high oil production in USA and refusal to honour the commitments under Paris Agreement (COP: 21), this study investigates the role of education, oil prices and natural resources on CO 2 emissions and energy demand in the USA for the period of 1976-2016. In so doing, we employed a bounds testing approach to cointegration which also accounts for the structural breaks. Key findings suggest the presence of a long-run association between underlying variables. The abundance of natural resources and economic growth of the US economy seem to weigh on environmental quality by increasing energy consumption and carbon emissions. Oil prices show a negative association with energy consumption as well as carbon emissions suggesting that a low oil price regime can lead to an increase in carbon emissions and energy consumption. Interestingly, education seems to play an important role by reducing energy consumption and carbon emissions, resultantly improving the US environmental quality. Our findings have profound environmental implications in terms of efforts to tackle climate change and meeting the Paris agreement (COP: 21) ambitions with reality and USA policy stance.

show abstract

Section: Oil Price/ Energy Consumption Income and Emissions Nexussupporting

confidence: 79%

Environmental implications of increased US oil production and liberal growth agenda in post -Paris Agreement era

Shahbaz

Kablan

Hammoudeh

et al. 2020

Journal of Environmental Management

View full text Add to dashboard Cite

show abstract

“…Furthermore, oil demand in South and Central America appears to respond more to prices than any other region, with the least response being in North America. While it might be expected that the advanced economies of the OECD should respond more to prices, results from oil demand studies point to a similar outcome as can be found in Dargay and Gately () and Asali ().…”

Section: Data and Estimation Resultssupporting

confidence: 72%

Modelling and forecasting world oil demand: a regional analysis accounting for asymmetric price responses and technical progress

Suleiman

2019

OPEC Energy Review

View full text Add to dashboard Cite

This study applies the structural time-series modelling technique to investigate the relationship between aggregate oil consumption, income and prices across six regions of the world over the period 1970-2017. Following arguments in the energy economics literature on how to appropriately capture the impact of technical progress (TP) in modelling energy demand, this paper assumes a general model that incorporates asymmetric price responses (to capture endogenous TP) and an Underlying Energy Demand Trend (UEDT) (to capture exogenous TP and other factors) to estimate price and income elasticities for each region. These estimates are then used to produce future forecast scenarios of oil demand for each of the six world regions up to 2040 based on different assumptions about the future path of key variables that drive oil consumption. The results suggest that for the reference-case scenario, global oil demand is projected to rise from 98 mb/d in 2017 to 118 mb/day in 2040 consisting of strong growth in the Middle East, Africa and Asia Pacific regions while oil consumption in North America, South/ Central America and Europe/Eurasia regions is projected decline.

show abstract

“…There is also a large body of literature which studies asymmetry in areas outside of transportation fuel demand. On the energy demand side, these include demand for petroleum products (Asali 2011, Dargay and Gately 1995, Broadstock et al 2011, residential energy (Haas and Schipper 1998), industrial energy (Adeyemi and Hunt 2007), total energy (Dargay 1992, Adeyemi et al 2010. On the travel demand side, the examples include Gately (1992), Dargay (2001), Greene (2012) and Hymel and Small (2015) for car travel or Wadud (2014Wadud ( , 2015 for air travel; yet Frondel and Vance 2011use household data to find travel demand in Germany was reversible with respect to prices.…”

Section: Review Of the Literaturementioning

confidence: 99%

Asymmetry in transport fuel demand: Evidence from household level data

Wadud

2017

Transportation Research Part D: Transport and Environment

View full text Add to dashboard Cite

Models for gasoline demand for transportation activities generally assume that demand is perfectly reversible with respect to gasoline price (and income). The small literature which relaxes the reversibility assumption in gasoline demand argues technological fixation leads to this asymmetry and utilizes aggregate time-series model to find evidence in favour of asymmetry. In this research it is suggested that there could also be behavioural factors behind this asymmetric response, possibly due to the loss aversion nature of human beings as described in the prospect theory. For the first time, household level data was used to understand asymmetry in gasoline demand in response to changes in gasoline price and income. There was statistical evidence that gasoline price and income both can induce asymmetric changes in gasoline demand among households. Specifically, elasticity with respect to rising prices and falling income is larger than the elasticity with respect to falling prices and rising income respectively, which is consistent with loss aversion in gasoline purchase behaviour. There was also some evidence of heterogeneity in the asymmetric responses between urban and rural households. The results have implications for transport-related energy tax policies or subsidies, while the method can be applied directly for non-energy goods as well.

show abstract

Income and price elasticities and oil‐saving technological changes in ARDL models of demand for oil in G7 and BRIC

Cited by 7 publications

References 11 publications

Environmental implications of increased US oil production and liberal growth agenda in post -Paris Agreement era

Environmental implications of increased US oil production and liberal growth agenda in post -Paris Agreement era

Modelling and forecasting world oil demand: a regional analysis accounting for asymmetric price responses and technical progress

Asymmetry in transport fuel demand: Evidence from household level data

Contact Info

Product

Resources

About