If gas prices are at an all time high, why are consumers driving more? Are they just idiots? Or is the price of a gallon of gas not the only thing to compute?
Forbes’ Nick Schulz thinks it’s the latter: that people are driving more because energy, even at the current prices, is simply a better deal than it’s ever been. Although energy prices are rising, energy intensity is declining. Whether you’re a car driver, a home owner who needs to heat his house or a gigantic corporation that needs to consume energy to produce your products, you can produce more with less energy than you ever could before. Energy, overall, is less important to the economy than it ever has been before.
It’s an interesting point: why aren’t we seeing the sort of panic through the current energy gouging that we saw in past energy crises? What about you guys? Have you started gripping the nozzle a bit more tightly, shaking out the last few drops at the pump lately? Or are you driving as much, if not more so, than ever before?
Why The Pump Isn’t More Painful [Forbes]