There is strong statistical evidence, in fact, that Americans respond rather slowly to changes in fuel prices. The cost of gas twelve months ago, for example, has historically been a much better predictor of driving behavior than the cost of gas today. In the energy crisis of the early 1980s, for instance, the price of gas peaked in March 1981, but driving did not bottom out until a year later.Ford's stock, incidentally, is up about 7 percent today and more than 150 percent since the start of the year. Nevertheless, there are some signs that we are becoming a less car-dependent nation:
Thus, the continued decrease in driving today reflects, in part, a delayed reaction to hundred-dollar-a-barrel oil. Maybe our commuter finally did get fed up and move his family to the city, but it took him until now to do so. The real test will come as the summer unfolds and Americans have had time to get "used to" lower gas prices.
Between October 2004, when gas prices first hit two dollars a gallon, and December 2008, when they fell below this threshold, three cities with among the largest declines in housing prices were Las Vegas (-37 percent), Detroit (-34 percent), and Phoenix (-15 percent), each highly car-dependent cities. Conversely, the two markets with the largest gains in housing prices were Portland, Oregon (+19 percent), and Seattle (+18 percent), communities that are more friendly to alternate modes of transportation.The rest of the column is available here.