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Was the German fuel discount passed on to consumers?

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  • Kahl, Mats Petter

Abstract

In this article, I analyze whether German gasoline stations passed on the gasoline tax reduction to consumers. I use a difference-in-differences approach with France as the control group, as well as data for all countries in the European Union. The German fuel discount was in effect from June to August 2022. As I am the first to use complete French and German high-frequency data for the entire treatment period, I can examine how the pass-through of the tax cut evolved over time, varied for different brands, and in various geographic regions. I find a substantial variance in pass-through rates over time and space. On average, the pass-through of the fuel discount was very high but remained incomplete for all fuel types. The pass-through rates were systematically lower in rural regions and in the south of Germany.

Suggested Citation

  • Kahl, Mats Petter, 2024. "Was the German fuel discount passed on to consumers?," Energy Economics, Elsevier, vol. 138(C).
    • Handle: RePEc:eee:eneeco:v:138:y:2024:i:c:s0140988324005516
    DOI: 10.1016/j.eneco.2024.107843
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    References listed on IDEAS

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    More about this item

    Keywords

    Pass-through; Gasoline market; Tax reduction; Fuel taxes; Petrol prices;
    All these keywords.

    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices

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