aaus-list @ ukrainianstudies.org -- [aaus-list] Something about the tiger in your tank and why it costsso much

["Max Pyziur" <pyz@brama.com>]

fyi,

PutATigerInYourTank
pyz@brama.com

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Energy Economics
Volume 27/5, published September, 2005

Oil price volatility and the asymmetric response of gasoline prices to oil
price increases and decreases
Radchenko S., p. 708

http://www.sciencedirect.com/science/article/B6V7G-4GWBDYP-1/2/3e3561d15ebb2e06b423d8662db6fe52


Received 18 August 2004;  accepted 29 June 2005.  Available online 15
August 2005.

Abstract

This paper analyzes the effect of volatility in oil prices on the degree
of asymmetry in the response of gasoline prices to oil price increases and
decreases. Several time series measures of the asymmetry between the
responses of gasoline prices to oil price increases and decreases and
several measures of the oil price volatility are constructed. In all
models, the degree of asymmetry in gasoline prices declines with an
increase in oil price volatility. The results support the oligopolistic
coordination theory as a likely explanation of the observed asymmetry and
are not consistent with the standard search theory and the search theory
with Bayesian updating.

Keywords: Gasoline price response; Asymmetric response; Search theory

Stanislav Radchenko
http://www.belkcollege.uncc.edu/sradchen/