Last week, I argued that U.S. military spending ought to be considered in a tally of energy subsidies. Daniel Hall thoughtfully disagrees: You can certainly find estimates that imply total U.S. energy subsidies are north of $100 billion a year, but I haven’t seen any estimates that look rigorous or convincing. This study put out …
The GAO looks at the energy-saving benefits of a reduced speed limit. The answer? Dunno. For high speeds, going slower for sure saves gas, but there’s the whole lawlessness thing… However, other factors, including drivers’ compliance with a reduced speed limit, would affect the actual impact of a lower speed limit on the amount of …
From Wednesday morning’s Financial Times, an example of what happens when the price of oil drops. It’s Saudi Arabia, reviewing the capital investment it was planning back in the olden days, when oil was expensive: Mr Buraik said he expects other countries to conduct their own reviews in the wake of changing dynamics. “People would …
An interesting new working paper by Hall et al. looks at the role of energy subsidies in the developing world as a problem – and potential solution – in dealing with climate change: Many non-OECD countries currently subsidize energy, and particularly fossil fuels, thereby creating an opportunity for subsidy reform or elimination that would have …
One of the problems with cartels is the extent to which members cheat. According to the EIA, OPEC’s members can be expected to cheat on their latest agreement to cut production though, oddly, EIA expects them to cheat less than usual: A key question regarding OPEC’s October 24 announcement of a 1.5 million bbl/d output …
My take on why Jeff Bingaman as Energy Secretary doesn’t make a lot of sense: But there is a story I’ve heard told enough times that, if it’s not true, it ought to be. When Bill Richardson was being considered for the position of Energy Secretary in 1998, he asked Bingaman what he thought. Bingaman’s …
Here’s another remarkable measure of “income elasticity” – the consumption response to being (or feeling) broke: That’s EIA’s “petroleum product supplied”, which is a good proxy for gasoline consumption. Contrary to a bizarre story in the New York Times last week, gasoline consumption has fallen off a cliff since early September. The Times story suggests …
Elasticity – consumers’ changing demand for a good – comes in two flavors. When prices go up, we consume less. But we also consume less when we’re broke, which is what’s happening today in the auto market. Gas prices are dropping like a stone in a pond, but as James Hamilton notes, we’re not buying …
Economists sometimes get a bad rap – the unfair belief that they worship at the alter of markets above all else, ignoring real problems as a result. In fact, a great deal of contemporary economics is focused on the opposite – understanding the places where markets fail, and helping craft policies that can make up …
David Strahan in the Independent: A falling oil price has real short-term benefits. Petrol has dropped below £1 per litre for the first time in almost a year; domestic heat and power bills should eventually follow; food prices and inflation should also ease, giving the monetary authorities greater freedom to cut interest rates. But these …