Gas Prices Matter To U.S. Households, But Only Somewhat - Green Car Reports
Starting in late 2014, U. S. gas prices began to drop significantly, and they've remained comparatively low throughout 2015. With the arrival of the summer travel season, analysts expect prices to increase--as they customarily do at this time... DON'T MISS: Gas Prices To Rise Again, So Fuel Economy Crucial In New Cars, Consumers Say. It appears that demand for gasoline is more or less inelastic, but that fuel costs represent only a small fraction of the average U. S. household's budget, according to an analysis by the Brookings Institution. Because most people use their cars for commuting and other essential tasks, they can't dramatically cut the amount of fuel they buy when prices climb. A comparison using Energy Information Administration and Bureau of Labor Statistics showed that gas prices and consumers' relative expenditures on gas remained in lockstep between 1993 and 2013. When gas prices increased, so did spending. When gas prices went down, spending went down. ALSO SEE: Obama: Buy A Fuel-Efficient Car, Gas Won't Stay Cheap Forever. Source: www.greencarreports.com
