The demand for cars and the price of gasoline: the user cost approach.

Research output: Contribution to journalArticlepeer-review


Investigates the effect of operating costs, that is, the price of gasoline, on the demand for cars. Shows that when operating costs are nonnegligible, and a car purchase involves significant transaction costs, the aggregate demand for cars should incluce operating costs and user costs as separate components. Section II discusses the user cost approach and the data. Section III describes the model and derives the equations for estimation. Section IV presents the estimate for new and total quantity of car services in the aggregate. Separate equations for different engine sizes are given in section V. Section VI is a short summary. -from Author

Original languageEnglish
Pages (from-to)184-190
Number of pages7
JournalReview of Economics and Statistics
Issue number2
StatePublished - 1982


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