Diesel powered vehicle share and transport fuel demand, an aggregate approach applied to Spain

Abstract

The increasing mobility and the associated fuel consumption has tremendous effects on the environment. Regarding Greenhouse Gases, the recent commitment for reduction can not leave unaffected this crucial sector. For that, a deep analysis of how socio-economic factors move the demand for fuel is needed. One of the main obstacles in this aggregate analysis of this demand has been the shift, in Spain as in large part of Europe, from gasoline-powered to diesel-powered vehicles. In this paper an econometric analysis of how this shift can affect both gasoline and diesel consumption pattern is provided, by applying 5 different estimators to a modified habit-persistence model. Data come from a panel composed by the peninsular autonomous communities in Spain. Results show a high impact of the share of diesel powered vehicles when considering the specific gasoline and gasoil demand but the same does not hold when considering the total fuel consumption, where the impact is much lower