 The rebound effect for automobile travel: Asymmetric response to price changes and novel features of the 2000sKent M. Hymel and Kenneth A. Small Energy Economics, 2015, vol. 49, issue C, 93-103 Abstract: Previous research suggests that the elasticity of light-duty motor vehicle travel with respect to fuel cost, known as the “rebound effect,” is modest in size and probably declined in magnitude between the 1960s and the late 1990s. However, turmoil in energy markets during the early 2000s has raised new questions about the stability of this elasticity. Using panel data on U.S. states, we revisit the simultaneous-equations methodology of Small and Van Dender (2007) and Hymel et al. (2010) to see whether structural parameters have changed. Using data through 2009, we confirm the earlier finding of a rebound effect that declines in magnitude with income, but we also find an upward shift in its magnitude of about 0.025 during the years 2003–2009. In addition, we find that the rebound effect is much greater in magnitude in years when gasoline prices are rising than when they are falling. It is also greater during times of media attention and price volatility, which explains about half the upward shift just mentioned. Keywords: Rebound effect; VMT elasticity; Gasoline demand; Asymmetric response (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:eneeco:v:49:y:2015:i:c:p:93-103 DOI: 10.1016/j.eneco.2014.12.016 Access Statistics for this article Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant More articles in Energy Economics from Elsevier |
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