Reason and rationality during energy crises
This paper develops a technique for extracting the expectations embedded in the current prices of energy-using durable goods and applies it to be used-car markets during the two energy crises of the 1970s. The resulting estimates indicate that consumers took the energy crises seriously and formed expectations about future gasoline prices that appear rational when compared with the historical gasoline price series, with the forecasts of specialists and experts, or with the actual postsample behavior of gasoline prices. The evidence therefore supports the view that consumers are able to make rather complex choices with a great deal of rationality and casts doubt on the wisdom of policies based on assumptions to the contrary. 17 references, 2 figures.
- Research Organization:
- Univ. of Houston, TX
- OSTI ID:
- 6137278
- Journal Information:
- J. Polit. Econ.; (United States), Vol. 91:1
- Country of Publication:
- United States
- Language:
- English
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POLICY AND ECONOMY
32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATION
AUTOMOBILES
DECISION MAKING
ENERGY SHORTAGES
BEHAVIOR
GASOLINE
ECONOMIC ELASTICITY
FUELS
LIQUID FUELS
PETROLEUM PRODUCTS
SHORTAGES
VEHICLES
290200* - Energy Planning & Policy- Economics & Sociology
320203 - Energy Conservation
Consumption
& Utilization- Transportation- Land & Roadway