Early signs: higher gas prices lead to less driving

With gas prices moving upward, there are some signs that this is already changing driving behavior among Americans:

Drivers bought about 2.4 million fewer gallons for the week of April 1, a 3.6 percent drop from last year, according to MasterCard SpendingPulse, which tracks the volume of gas sold at 140,000 service stations nationwide…

Before the decline, demand was increasing for two months. Some analysts had expected the trend to continue because the economic recovery was picking up, adding 216,000 jobs in March…

Instead, about 70 percent of the nation’s major gas-station chains say sales have fallen, according to a March survey by the Oil Price Information Service. More than half reported a drop of 3 percent or more — the sharpest since the summer of 2008, when gas soared past $4 a gallon. Now it’s creeping toward $4 again…

The decline is somewhat puzzling because Americans typically curb their driving only as a last resort, after sacrificing other forms of discretionary spending, like shopping for new clothes, or going to movies, concerts and restaurants.

Economists and others have been talking about this for a while: what exactly is the price point of a gallon of gasoline where Americans might drastically change their transportation patterns? In this earlier post, I briefly discussed the claim that the Obama administration actually wants higher gas prices as this would lead to greener transportation choices such as mass transit or bicycling or car pooling (or other options).

But if gasoline prices stayed relatively high (so they don’t really go down like they have after some of the temporary spikes in recent years – see the weekly average in the US going back to 1990 here or a graph showing prices going back to the mid 1970s here), it might lead to all sorts of changes. This could include everything from buying smaller cars (as the story above suggests is happening) to more Amtrak riders to longer semi trailers to rethinking patterns of sprawl.

0 thoughts on “Early signs: higher gas prices lead to less driving

  1. Pingback: Economy down, traffic congestion down | Legally Sociable

  2. Pingback: Correlation found between less decline in sustainable city transportation and wealth, required state planning | Legally Sociable

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