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Price and Income Elasticities of Demand for Crude Oil. A study of thirteen OECD and Non-OECD Countries
CHRISTOS TSIRIMOKOS & GEORGIOS MAROULIS
This study examines the determinants of crude oil demand in a panel of thirteen OECD and non-OECD countries constituting about 62% of global crude oil consumption in 2015. Panel unit root and panel cointegration techniques are employed for the estimation of price and income elasticities of crude oil demand. Estimated coefficients in the panel have a statistically significant impact on oil consumption both in the short-run and in the long-run. The empirical panel findings reveal that in the short-run, crude oil demand is price and income inelastic while in the long-run, crude oil demand is income elastic and price inelastic. On the other hand, the estimated coefficients on the price and income variables vary across countries and they are in most of the cases statistically significant.
Volume :- No.10 (2016)
Issue No :- 2 (2016)
Pages :- 161-180