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Originally Posted by Mavdog
Gasoline tax is Germany is almost $4.00 per gallon. In the USA it averages $.40 per gallon. that is the reason for the difference in retail price.
recent economist research indicate that demand for gas has become more inelastic, not less. this may be the increased urbanization (more people live in urban areas today than in the past), higher CAFE standards, dual income families, or even the increased technology that allows virtual offices. the result is that people do not substantially change their driving habits when the price increases.
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You are probably correct about it being more inelastic, but I think it's according to how much it moves and for how long. In general it seems the average price of a gallon is about 2.00 bucks. I thought when it went to 3.00+ I saw more movement to curtail driving and that drove stockpiles up (and prices back down). I do think that folks sort of expect gasoline to come back down and so changes aren't apparent....then they do.
I would expect that a 2.00 tax on gasoline would cause quite a bit of change in behaviour (possibly just automobile purchases primarily or car-pooling) but it would have to stay there for a year or so. Not the couple of months we see.
I think that I saw a much higher incidence of DART usage when it hit 3.00+, but it was a non-scientific observation.