Long term fuel price elasticity
Axhausen, Kay W.
- Working Paper
Rights / licenseIn Copyright - Non-Commercial Use Permitted
The study analyzes how mobility tool usage and ownership as well as residence location choice are affected by rising fuel costs. Based on econometric models, long-term fuel price elasticities are derived. Based on data collected in stated choice and stated adaptation experiments that were conducted as computer-based face-to-face surveys, a structural equation model was estimated. The resulting fuel price elasticities are primarily dependent on fuel type and fuel price level, but sociodemographic variables, such as income, also have significant effects on elasticity. The price elasticity of gasoline for a prices of 1.5 CHF/l and 5 CH/l ranges between -0.31 and -0.60. For diesel and natural gas, the elasticities range between 0.32 and -0.67 and 2.74 and -0.93 whereas the positive elasticity values are caused by substitution effects. The mainly observed demand reactions given higher fuel prices are the reduction of mileage and the consideration of smaller engine and diesel cars. As natural gas and electric engined cars were hardly considered in the survey, the results of the natural gas model can only serve as trend whereas no stable model could be estimated for the demand and usage of electric cars. Although the results presented herein are based on the for this topic novel stated adaption approach, the results are comparable to other studies, namely to the recent time series based fuel price elasticity study of Baranzini et al. (2009). They report a long term price elasticity of -0.27 for all fuels and -0.34 for gasoline. In terms of a possible impact of fuel prices on residence location choice, the results suggest a high aversion to moving away from the current type of residence location. The willingness to pay more before moving to a more central location that has lower mobility costs is dependent on income and the spatial types of both the old and envisaged residence location. For an average income, mobility costs range between 463 CHF/month in the case of a residence location change from an agglomeration to an urban area and 2040 CHF/month when moving from a rural area to the city center. In addition, differences in the valuations of housing, car and public transport costs are identified, in which car costs are generally the least negatively valued. SP1: Effect of price changes on mobility tool ownership The first of three stated preference experiments is designed as a stated adaption experiment. Given today’s residence, but a new price regime of mobility costs, the respondent has to indicate the respective choice and usage of mobility tools for all household members. Each respondent is confronted with six such situations, which are predefined by the experiment plan. The experiment plan is constructed by orthogonal design and combines three variables with different levels. For each situation, only one incentive type is considered Show more
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Journal / seriesTravel Survey Metadata Series
PublisherIVT, ETH Zürich
SubjectStated Preference; Fuel price; Mobility tool ownership
Organisational unit03521 - Axhausen, Kay W. / Axhausen, Kay W.
02226 - NSL - Netzwerk Stadt und Landschaft / NSL - Network City and Landscape
02655 - Netzwerk Stadt und Landschaft D-ARCH
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