Crude Oil and Gasoline Prices in Fiji: Is the Relationship Asymmetric?
B. Rao and
Microeconomics from EconWPA
This paper tests and confirms asymmetry in the Fiji gasoline price adjustment equations with respect to changes in the crude oil prices. More satisfactory specifications and estimation are used than in the earlier studies. It is found that two alternative approaches viz., the Granger two-step and the LSE-Hendry general to specific approaches, give similar results. Our results show that oil firms in Fiji seem to adjust gasoline prices twice faster than decrease them.
Keywords: Crude Oil and Gasoline Prices; Asymmetric Price Response; Rockets and Feathers Hypothesis; Granger Two-Step Estimation; the LSE- Hendry General to Specific Approach. (search for similar items in EconPapers)
JEL-codes: C1 C5 C8 (search for similar items in EconPapers)
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Note: Type of Document - pdf; pages: 20
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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpmi:0510004
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