clipped from: www.financialaidpodcast.com   

The economics of gasoline protests

I thought I’d take a moment to point out, since I’ve gotten a bazillion IMs and emails about it, that the proposed boycott of gasoline pumps on May 15th makes absolutely ZERO economic sense, nor will it have any impact on pump prices.

Deferring a gasoline purchase on one day simply pushes demand to the subsequent days, because unless you stop or decrease your driving, your gasoline consumption will not change in aggregate, and therefore neither will the price of gasoline.

Want to do something EFFECTIVE on May 15th? Want to make gasoline prices CHANGE? Do these two things:

First, inflate your tires to the maximum safe pressure recommended by the vehicle manufacturer. For my car, for example, this is 38 psi. The dealership sets the tires at 28 psi because it gives the perception of a smoother ride at the cost of more fuel