The effect of domestic petroleum price movements on pollution from transportation using uber movement data
Date
2017
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Abstract
The Philippines is currently experiencing rapid economic growth leading to worsening
travel time and a concomitant increase in air pollution. Literature on developed
countries show that drivers have high price elasticities when oil prices increase due to
an increase in tax causing an adjustment on consumer decisions and may imply an even
greater long-run effect on traffic congestion and air quality. The study employs a two-
stage regression model to illustrate the effect of domestic oil prices on the average travel
speed of vehicles and consequently on Total Suspended Particle (TSP) concentrate. The
results show that imposing a 10 peso-tax increase on petroleum products such as
gasoline as proposed by the Tax Reform for Acceleration and Inclusion (TRAIN) Bill
positively affects average travel speed by 2.1 km/hr and negatively affects TSP
concentrate levels by more than 15 μg/Ncm. Thus, justifying the environmental context
behind the TRAIN bill to internalize pollution caused by transportation.
Description
Keywords
air pollution, oil prices, average travel speed, TSP concentrate, TRAIN