Thursday, May 24, 2007

how much will you pay to drive 20 miles?

A poll by the Washington Post and ABC News "surprised" some experts by noting that people are willing to pay well over $4 a gallon for gas before curtailing their driving -- over $5 in the western US.

I'm not sure why they are so surprised. So much in American life relies on a trip in an automobile, especially if you don't happen to live in one of those rare urban centers with a combination of dense development and adequate public transport systems. I mean, if you live in some exurb like Reston, Virginia, the odds are pretty damn good that there is nowhere you can walk to easily or safely (sidewalks, anybody? Not so common in many 'burbs.) walk to even if you WANTED to. And you probably don't live anywhere close to your job, either.

So sure, if the choice is pay $4.50 for a gallon of gas or quit your job that is 30 miles (and 3 hours by public transport) away, or not go grocery shopping (5 miles away), people are gonna drive. That's the very definition of a product with inelastic demand. Sucks rather badly for the poor of course but we don't really care about that in George W. Bush's America, do we?

On the other hand, I would expect sustained higher gas prices to drag down demand for those absurdities of the American roads, SUVs...



Post a Comment

<< Home