Evidence That Time Makes Demand More Elastic

(Don Boudreaux)

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In agreeable response to my recent letter to the Wall Street Journal on the fact that, over time, consumers adjust to high gasoline prices by taking steps such as moving closer to their workplaces, Tim Worstall sent to me this e-mail:

Don,

My example of this has for many years been EU v US.

People in Europe live closer to work, shop more locally, drive shorter distances in cars with smaller engines and higher fuel efficiency than those in the US.

Petrol (gasoline) and diesel have been more expensive in Europe for at least a generation now.

We seem to have our proof.

Tim