Pedal Past the Pumps

Abstract

This paper analyses the substitution effects between commuter bicycling and the price of gasoline. A multiple regression analysis is conducted to determine the elasticity of demand for bicycles from gasoline as well as other relevant variables, availability of bike sharing, population density, bike paths, median income, days below zero degrees Celsius, precipitation, and the CPI for recreational vehicles (including bicycles) and public transportation. The analysis is conducted using both pooled average and random effects regression models. The modelling showed that there is indeed a substitution effect on the demand for commuter cycling due to the price of gasoline. The study also shows asymmetrical results for male and female cyclists, showing that male and female cycling habits are influenced by different variables. This analysis suggests that policy makers can influence rates of cycling by manipulating the cost of its alternatives as well as the opportunity costs of cycling itself.