Achieving Gasoline Price Stability in the U.S.: A Modest Proposal

Mark S. LeClair

The Energy Journal, 2006, vol. Volume 27, issue Number 2, 41-54

Abstract: The recent volatility of short-run gasoline prices in the United States has resulted in calls for the government to intervene. This paper details a simple means of reducing that variability, utilizing federal tax policies, without eliminating the signaling role of prices in the medium- to long-term. If properly implemented, the gyrations in gas prices could be largely removed, with little impact on the revenue that the federal government generates through taxation. If applied to the markets in nations that have significantly higher gasoline taxes, essentially all price volatility could be removed.

JEL-codes: F0 (search for similar items in EconPapers)
Date: 2006
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