The structure of consumer energy demand in Australia: an application of a dynamic almost ideal demand system

Akmal Muhammad

No 125050, 2002 Conference (46th), February 13-15, 2002, Canberra, Australia from Australian Agricultural and Resource Economics Society

Abstract: By parameterising the Almost Ideal (AI) demand system as a vector error correction model (VECM), this paper estimates the structure of consumer energy demand in Australia. To this end, domestic per person expenditure on energy is divided into the expenditure on electricity, gas and a miscellaneous category, residual fuels. To close the system, non-energy household consumption expenditure is introduced, resulting in a four-equation share system, which is estimated using national-level quarterly data. The demand for electricity and gas is price and income inelastic whereas that of other fuels is highly price elastic. Significant substitution possibilities are found between electricity and other fuels and between gas and other fuels. However, electricity and gas – which, together, account for more than 90 per cent of household fuel expenditure – are estimated to be complementary fuels.

Keywords: Consumer/Household Economics; Resource/Energy Economics and Policy (search for similar items in EconPapers)
Pages: 21
Date: 2002-02
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/125050/files/Akmal.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:aare02:125050

DOI: 10.22004/ag.econ.125050

Access Statistics for this paper

More papers in 2002 Conference (46th), February 13-15, 2002, Canberra, Australia from Australian Agricultural and Resource Economics Society Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().