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Politics : Politics of Energy -- Ignore unavailable to you. Want to Upgrade?

To: J_F_Shepard who wrote (1567)	8/13/2008 5:08:44 PM
From: Brumar89	Read Replies (1) \| Respond to of 86355

you(or Brumar) just said Americans have driven 3-4% less in the last year and gas prices have dropped 3.75% I did say that our use of gasoline is down over the past year. But the relevant comparison is with prices over that period, not merely the last couple weeks.

To: J_F_Shepard who wrote (1567)	8/15/2008 2:55:45 PM
From: TimF	Read Replies (1) \| Respond to of 86355

you(or Brumar) just said Americans have driven 3-4% less in the last year and gas prices have dropped 3.75% That's "first principles"? I don't think you know what the term means. And ignoring what you call the argument, and just dealing with the argument itself, Americans driving 3-4% less is not the same as a general decrease in gasoline consumption of 3-4%. Americans driving their own passenger vehicles is not the sole source of gasoline usage in the world or even in the US, and certainly its far from the sole source of oil use (and use of other oil products has some effect on the price of gasoline). Also as Brumar points out "the relevant comparison is with prices over that period, not merely the last couple weeks." Moreover even if you where correct that this actually represented a specific narrow case where there was a price elasticity of one, that would hardly represent significant evidence the price elasticities are generally 1, or even that the price elasticity of oil or gasoline is 1. Look at the increase in gasoline over the last several years. Americans decreased their driving far less than the several hundred percent increase in gasoline.