Energy Demand in the Primary-Metals Industry: An Econometric Analysis

摘要

A generalized fuel-choice model for four fuels is formulated and is used to estimate the coefficients and three types of price elasticities for the primary metals industry. The generalized fuel-choice model differs from the multinomial logit model in that there are no a priori restrictions on the price elasticities and that third price effects are not ignored. Both the generalized fuel-choice model and a multinomial logit model are estimated for the total period (1967, 1971, 1974, 1975, 1976, 1977), the pre-embargo period (1967, 1971), and the post embargo period (1974 to 1977). Dynamic versions are also estimated with data from 1975 through 1977. The results are used to illustrate a structural change in the primary metals industry's demand for energy, forecast energy demand and fuel market shares to the year 2000, and evaluate several possible energy policies.