Much Ado About Gas Prices

markmcb writes "It seems that a week cannot pass without finding big news about gas prices. They're up, they're down ... but why do we care so much? OmniNerd posted an article that aims to put gas prices in perspective. The author takes a look at other commodities and their price variances and applies some simple math in order to make the claim that best-gas-price-hunting is an effort that could be better used on other products. From the article, 'Why the disproportionate emphasis on gas prices in our culture, then? Although some cite a failure of politicians or media populists to account for inflation and purchasing power changes, I think it is simply because gas prices are in your face.'" IMO, the other side to the price of gas is that, especially in developed countries, it has a pervasive effect throughout all layers of the economy — food prices (because of the trucking), schools (busing), etc., etc.

Comments

Eh hem, size matters.

[suso]

Perhaps the size of the price sign is what matters. Gas prices are shown in large high contrast fonts on every street corner. The price sticker on a bottle of shampoo is less noticeable or sometimes not noticeable at all. You just pick it up and put it in your cart.

In mathmatical terms, figuring that the price sign at a gas station is about 6 feet by 4 feet, and the price sticker on a shelf for a bottle of shampoo is 2 inches by 1 inch, the gas station sign is about 1,728 times larger and thus more emphasis is placed on the price of gas.

It's not just gas-at-the-pump prices

[autophile]

It's not just mommy and daddy filling up the family sedan. It's everything that depends on petroleum products. Asphalt, for example. Heating oil. Plastics. And, as the summary points out, transportation of *everything*.

Gas prices is one of those easily understood metrics that happens to affect everything we do (in developed countries).

--Rob

Re:To really put things in perspective..

[GigsVT]

Would you pay $6/gallon for gas to support the taxes required for all those socialist services?

Re:Exxon Mobile

[Anonymous Coward]

Beware: Economics follows.

The demand for gasoline is relatively inelastic. If you raise the price, demand does not fall all that much. So, raising the price often means you would make more money. It's a typical monopoly tactic to restrict the supply of something and artifically raise the price against an inelastic demand, and thus gain more revenue. (See also: Windows.)

If anything, the higher profits associated with this price of gas after the hurricane (when supplies are lowered by other forces) should demonstrate that under normal conditions, the industry is actually fairly competitive, and you're paying a relatively fair price for your gasoline. (Well. Aside from taxes.)

Re:To really put things in perspective..

[Don853]

I would gladly pay $6/gallon if it would get all the jackasses driving Yukons with one passenger off the road. The public transit would be nice, but it would require everyone to not live on 3/4 acre in a development 35 miles from the center of the city for it to be even plausable.

Re:mod parent up

[LaughingCoder]

It's election season, dumbasses, they're lowering prices to help out their buddies in Washington.

Nice theory, but what happened in 2004? Remember all those rumors that Bush had a secret arrangement with the Saudis and they were going to lower gas prices around the election to make Bush look good. Well, it never happened. http://www.eia.doe.gov/oil_gas/petroleum/data_publ ications/wrgp/mogas_home_page.html In fact, gas prices peaked in November of 2004, having risen over 20% from March to November of that year.

Re:To really put things in perspective..

[egburr]

I've tried taking the bus. It turns my 25 minute drive into a 70 minute bus ride. I still have to drive 2 miles to reach the bus stop, mainly because I have to cross a 6-lane road that has no pedestrian conveniences such as a crosswalk at the nearest intersections (walking to the nearest crosswalk would make the trip a 4 mmile walk). I have two choies of bus routes, and both are about equivalent in inconvenience, only a few minutes difference in travel time.

I hate driving in traffic. I would love to take the bus. However, I just can't do it with the current options. One major reason is that I have to pick up one of my children from after school care by 6:00pm. To do that, I would have to take the 4:25 bus from work, which is a little difficult when I get off at 5:00. Of course, I could start work earlier, which means I would have to catch the first bus of the day at 6:00, which is a little difficult since my son's school bus doesn't arrive until 7:25 and the school won't allow children to be dropped off until 8:00. I could enroll him in the before school care, too, but that doesn't start until 7:00, which still is insufficient for catching the 6:00 bus.

So, as much as I hate driving during rush hour (if you can call creeping at 15 mph driving), I still prefer it over riding the bus with the options I currently have.

The city here puts a lot of effort into showing how much effort they are putting into public transportation. They don't seem to put much effort into making it at all convenient for people to use.