Date of Award

Spring 1-1-2012

Document Type


Degree Name

Doctor of Philosophy (PhD)



First Advisor

Jonathan Hughes

Second Advisor

Nicholas Flores

Third Advisor

Robert McNown


Chapter one examines the nature of responses to market price changes in one market among other energy commodity markets continues to be uncertain. This paper looks at these energy commodity markets (oil futures, oil spot, gasoline futures, gasoline spot and gasoline retail) and explores the responses of market prices in all of those markets to an exogenous price shock in any one of the other markets. A four step estimation process is used to examine impacts in market prices from price and/or volatility shocks in another market, and a supply shock from an hurricane is analyzed to trace price impacts on these five markets. Results indicate that oil futures prices and price volatilities provide the most significant impacts in all markets. Chapter two presents a flexible model that allows for the tracking of the private and social costs associated with traffic congestion and road quality deterioration. The structure of the model is similar to the class of models within the existing literature that have been used to examine transportation costs. The focus, however, is to quantify the economic impacts from a variety of different government policies designed to alleviate traffic congestion and road quality deterioration. Despite the widespread recognition of the efficacy associated with the use of congestion tolls, the reality is that congestion toll policies are rarely adopted. Instead government policies are often adopted that seek to decrease traffic congestion through the construction of new roadways. Additionally, given budget constraints, governments often adopt policies that do not provide for road maintenance at levels necessary to prevent the road surface quality from declining. Results indicate that governments can pursue a policy of little road maintenance for 7 to 10 years before the economy is adversely affected. Chapter 3 examines a model of energy prices, possible affects of temporal aggregation associated with series that exhibit conditional heteroskedasticity. A seven equation recursive vector error correction model is used as a vehicle for analyzing and forecasting retail gasoline prices using daily, weekly, and monthly data. Six of the seven series exhibit strong signs of conditional heteroskedaticity. The four main topics addressed are impacts from macroeconomic performance on retail gasoline prices, the impacts of oil and gas price volatilities on retail gasoline prices, the importance of oil futures prices for retail gasoline prices, and the affect of temporal aggregation on the implications and forecasting performance of the model. Evidence suggests that the presence of conditional heteroskedasticity does not inhibit the application of a VECM framework, that macroeconomic performance does impact retail gas prices, price volatilities are a source of variation in retail gas prices, oil futures prices have a significant positive effect on retail gasoline prices, and temporal aggregation can distort underlying information inherent in a low frequency data generating process.

Included in

Economics Commons