Abstract
Oil price volatility harms economic growth. Diversifying into different fuel types
can mitigate this effect by reducing volatility in fuel prices. Producing bio-fuels may
thus have additional benefits in terms of avoided damage to macro-economic
growth. In this study we investigate trends and patterns in the determinants of a
volatility gain in order to provide an estimate of the tendency and the size of the
volatility gain in the future. The accumulated avoided loss from blending gasoline
with 20 percent ethanol-fuel estimated for the US economy amounts to 795 bn. USD between 2010 and 2019 with growing tendency. An amount that should be
considered in cost-benefit analysis of bio-fuels.
can mitigate this effect by reducing volatility in fuel prices. Producing bio-fuels may
thus have additional benefits in terms of avoided damage to macro-economic
growth. In this study we investigate trends and patterns in the determinants of a
volatility gain in order to provide an estimate of the tendency and the size of the
volatility gain in the future. The accumulated avoided loss from blending gasoline
with 20 percent ethanol-fuel estimated for the US economy amounts to 795 bn. USD between 2010 and 2019 with growing tendency. An amount that should be
considered in cost-benefit analysis of bio-fuels.
| Original language | English |
|---|---|
| Place of Publication | Utrecht |
| Publisher | UU USE Tjalling C. Koopmans Research Institute |
| Number of pages | 25 |
| Publication status | Published - Feb 2011 |
Publication series
| Name | Discussion Paper Series / Tjalling C. Koopmans Research Institute |
|---|---|
| No. | 01 |
| Volume | 11 |
| ISSN (Electronic) | 2666-8238 |
