 Understanding E10 markets in the U.S.: Evidence from spatial dataSimla Tokgoz and Fousseini Traoré Economic Analysis and Policy, 2023, vol. 78, issue C, 1267-1281 Abstract: E10 is still the largest market for blending of ethanol in transportation fuels in the U.S. This paper analyzes the relationship between the input costs of transportation fuel blends (crude oil, wholesale gasoline) and the transportation fuel prices (E10) that U.S. consumers pay at the pump both in the short run and in the long run. The article employs a generalized spatial random-effects autoregressive-distributed lag model for E10 price using U.S. regional data. We estimate the short run elasticity of E10 price with respect to crude oil price as 0.28, and the long run elasticity as 0.42. In both the short run and the long run, the elasticities of E10 with respect to wholesale gasoline price are higher than the elasticities with respect to crude oil price; at 0.59 and 0.83. We find that the federal policy of E15 approval increased E10 prices. We do not find significant impacts of income or population on E10 prices. Keywords: Crude oil; E10; Ethanol; Gasoline; Price elasticity; Spatial panel (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:ecanpo:v:78:y:2023:i:c:p:1267-1281 DOI: 10.1016/j.eap.2023.05.018 Access Statistics for this article Economic Analysis and Policy is currently edited by Clevo Wilson More articles in Economic Analysis and Policy from Elsevier |
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