Gasoline demand with heterogeneity in household responses

Z Wadud, DJ Graham, RB Noland - The Energy Journal, 2010 - iaee.org
Fuel demand elasticities to determine consumer responses to tax increases or price shocks
are typically based on aggregate data. The literature generally provides one elasticity
estimate for each country, assuming similar response for all households. However, it is
possible that different households can have different responses to the same stimuli
depending on the household characteristics. Assuming a single elasticity for all households
may fail to capture the detailed distributional effect on different socio-economic groups …
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