Gasoline prices, transport costs, and the U.S. business cycles

Hakan Yilmazkuday

Journal of Economic Dynamics and Control, 2014, vol. 45, issue C, 165-179

Abstract: The effects of gasoline prices on the U.S. business cycles are investigated. In order to distinguish between gasoline supply and gasoline demand shocks, the price of gasoline is endogenously determined through a transportation sector that uses gasoline as an input of production. The model is estimated for the U.S. economy using five macroeconomic time series, including data on transport costs and gasoline prices. The results show that although standard shocks in the literature (e.g., technology shocks, monetary policy shocks) have significant effects on the U.S. business cycles in the long run, gasoline supply and demand shocks play an important role in the short run.

Keywords: Business cycles; Transport costs; Gasoline prices (search for similar items in EconPapers)
JEL-codes: E32 E52 F41 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Working Paper: Gasoline Prices, Transport Costs, and the U.S. Business Cycles (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:dyncon:v:45:y:2014:i:c:p:165-179

DOI: 10.1016/j.jedc.2014.06.002

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