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), Journal Name: J. Polit. Econ.; (United States) Vol. 91:1; ISSN JLPEA
- Country of Publication:
- United States
- Language:
- English
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290200* -- Energy Planning & Policy-- Economics & Sociology
32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATION
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Consumption
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AUTOMOBILES
BEHAVIOR
DECISION MAKING
ECONOMIC ELASTICITY
ENERGY SHORTAGES
FUELS
GASOLINE
LIQUID FUELS
PETROLEUM PRODUCTS
SHORTAGES
VEHICLES