Do retail gasoline prices respond asymmetrically to cost shocks? The influence of Edgeworth Cycles

A-Tier
Journal: RAND Journal of Economics
Year: 2009
Volume: 40
Issue: 3
Pages: 582-595

Score contribution per author:

4.022 = (α=2.01 / 1 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Asymmetric price cycles similar to Edgeworth Cycles are appearing in increasingly many retail gasoline markets in the United States and worldwide. The asymmetry in the cycles can give rise to a finding of asymmetric price responses to cost shocks (asymmetric passthrough). This article estimates asymmetric passthrough for the market of Toronto, which exhibits cycles, and decomposes it into two components—that part explainable by the cycles and that part driven by other unknown sources. Significant asymmetric passthrough is found, with increases passed through more quickly than decreases. A significant cause of the finding is the presence of the cycles themselves.

Technical Details

RePEc Handle
repec:bla:randje:v:40:y:2009:i:3:p:582-595
Journal Field
Industrial Organization
Author Count
1
Added to Database
2026-01-26