Roller Coaster Economics: Why Energy Price Volatility Hurts Families,Businesses, and the Economy

摘要

It is one thing for gas prices to be high, but there is another factor-price volatility. The two factors gyrate, and such inconsistent price behavior sends inefficient signals to consumers and business.rnAmerican families lived once again through a roller-coaster ride of rapidly rising gasoline prices in 2011 as the summer driving season began. As in many past springs, prices for regular gasoline soared by almost 30 percent between the end of 2010 and May 16, 2011 (Energy Information Administration [EIA] 2011a). And the Energy Information Administration of the U.S. Department of Energy projected that the average retail price of regular-grade gasoline will average $3.86 per gallon during the holiday driving season-from April 1 to September 30-up $1.10 from the previous summer, an increase of almost 40 percent (EIA 2011a).