Relationship between ethanol and gasoline: AIDS approach

Tenkorang, Frank; Dority, Bree L.; Bridges, Deborah E.; Lam, Eddery

doi:10.1016/j.eneco.2015.04.019

Cited by 9 publications

(8 citation statements)

References 28 publications

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“…Hence, if gasoline prices rise, the demand for ethanol increases, which causes an increase in ethanol prices. In Brazil, where most vehicles can use pure ethanol and high ethanol blends, the consumption of ethanol is influenced by price parity; 25%-30% less than gasoline [82]. In details, consumer decisions are driven by the ratio between ethanol and gasoline prices.…”

Section: Vector Error Correction Model (Vecm) Estimationmentioning

confidence: 99%

Interdependencies between Biofuel, Fuel and Food Prices: The Case of the Brazilian Ethanol Market

2016

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Abstract:Brazil is currently the world's largest sugar producer and exporter, as well as the world's largest producer and consumer of sugarcane ethanol as a transportation fuel. The growth of this market originates from a combination of government policies and technological change, in both the sugarcane ethanol processing sector and the manufacture of flex-fuel vehicles. In recent years however, ethanol production has been questioned due to its possible impact on food prices. The present paper aims to explore the impact of Brazilian ethanol prices on sugar and gasoline prices. The relationships between a times series of these prices are investigated using a Vector Error Correction Model (VECM), supported by Granger Causality tests. In addition, Impulse Response Functions (IRFs) and Forecast Error Variance Decompositions (FEVD) are computed in order to investigate the dynamic interrelationships within these series. Our results suggest that ethanol prices are affected by both food and fuel prices, but that there is no strong evidence that changes in ethanol prices have an impact on food prices.

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Section: Vector Error Correction Model (Vecm) Estimationmentioning

confidence: 99%

Interdependencies between Biofuel, Fuel and Food Prices: The Case of the Brazilian Ethanol Market

2016

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“…= k, then the value of k can be divided into the following three kinds: (1) When k£0, namely U 2 − C 2 < U 1 − C 1 + S l , S l ≥ 0, this infers that no matter what the probability of local government's support is , the value of y will always greater than k when the difference of the cost and utility of consumers' buying of traditional energy vehicles is smaller than the difference between the utility of buying new energy and the cost of central government's support. That situation meet the condition of formula (4) in which the zero solution expectation moment of formula (4) is unstable, and the evolutionary game of the system finally tends to the only stable point (1, 0). The corresponding stochastic evolutionary game of groups is shown in Figure 2.…”

Section: The Analysis On Evolutionary Equilibriummentioning

confidence: 84%

“…Compared with the traditional gasoline cars, new energy vehicles, as a new type of green transport, have lower energy consumption through its whole life circle and have less effect on comprehensive environment. Because of its advantages, many scholars are concerning about the new energy vehicles [1][2][3][4]. Christina [5] and her teams have studied the implementation of the "vehicle label plan", which launched by Brazilian government and aimed at improving energy efficiency.…”

Section: Literature Reviewmentioning

confidence: 99%

The behavior of consumer buying new energy vehicles based on stochastic evolutionary game

Guan

Zhang

Liu

et al. 2016

Filomat

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China's current vehicle emissions caused by air pollution problems have become increasingly prominent. How to improve new energy vehicle market share, and effectively guide the consumer buying behavior become a problem, which the government and social have to be solved. In this paper, according to establish the stochastic evolutionary game model between the government and consumers in the car market, introducing of random factors analysis on the impact of evolutionary stability ,will obtain the stable strategy of government and automotive consumers. And on the basis of it, we study the government support, cost of vehicles, the use of cost, the utility of automobile use for the ways of evolutionary stability, with case further illustrates the external disturbance factors on consumer purchase of new energy vehicles in evolutionary game process stability. Studies show that: the increasing government subsidy policy, the reducing life cycle costs of new energy vehicles and the improving effectiveness of new energy vehicles will lead the model's evolution to the orientation of consumer purchasing new energy vehicles.

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“…Despite recognizing the limitations of their model with regards to endogeneity, Tenkorang et al (2015) do not adopt any IV and uses the more popular estimation procedurethe seemingly unrelated regression (SUR) since literature could not find any significative difference from the suggested more robust three stages least square (3SLS) procedure. Rodrigues et al (2018) emphasised the importance of adopting a stochastic trend, rather than deterministic ones, to avoid biased results when the model does not incorporate technological progress as an exogenous process.…”

Section: Endogeneity Of Fuel Pricesmentioning

confidence: 99%

“…He also found out that ethanol has a high price elasticity, while gasoline is quite inelastic; thus, the former would need to have a premium price over the later. In the United States, Tenkorang et al (2015) concluded that ethanol used to be a substitute to gasoline between 1982 and 2005, but since 2006, its consumption has been complementary to the latter because US flex cars cannot use blends higher than E85. These studies show that, despite the specific characteristics of the Brazilian ethanol development, different markets might yield similar results to ours.…”

Section: Fuel Price Elasticity From 2003 Tomentioning

confidence: 99%

Understanding the Diffusion of Alternative Fuels Technologies for Transport

Brito¹

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I had many mentors during this journey and each one of them deserves an individual acknowledgement. Prof. Edmilson Moutinho dos Santos (University of São Paulo) thank you for your supervision, your critical approach every single time we talked and your engagement on the wellbeing of your students. Prof. Dominique Mouette (University of São Paulo) thank you for always seeing the potential in me and supporting me in time of needit is a great pleasure to part of your team. Prof. Towhidul Islam (University of Guelph) thanks for the warm welcome in Canada and for continually pushing me out of my comfort zone-I hope our partnership might be long-lasting despite our physical distance. Prof. Marc Stettler (Imperial College), thank you for kindly accept to work with me since the start of my PhD and to welcome me as part of your team in London-I hope we can also work together in future projects. Professor Nigel Meade, thanks for your fundamental contribution to our articles and for sharing your wide experience with us. Many thanks to the support all the staff and directors of my funding institutions: the Coordination for Higher Personnel Education (CAPES), the National Research Council (CNPq) and the Gas Innovation Fellowship Programme (GIFP). My warm thanks for the staff, professors and colleagues from the academic institutions that supported and received me at the: • Institute of Energy and Environment (IEE-USP);

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Relationship between ethanol and gasoline: AIDS approach

Cited by 9 publications

References 28 publications

Interdependencies between Biofuel, Fuel and Food Prices: The Case of the Brazilian Ethanol Market

Interdependencies between Biofuel, Fuel and Food Prices: The Case of the Brazilian Ethanol Market

The behavior of consumer buying new energy vehicles based on stochastic evolutionary game

Understanding the Diffusion of Alternative Fuels Technologies for Transport

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