ESTIMATION OF PRICE AND INCOME ELASTICITIES OF DEMAND FOR OIL, COAL AND NATURAL GAS IN TURKEY

This study aims to estimate income and price elasticities of demand for oil, coal and natural gas in turkey over the 1960-2012 period. the evidences obtained from johansen and juselius (1990) test indicate the existence of a longrun relationship among all energy types, their prices and income. cointegration tests show that natural gas consumption is inelastic with respect to both price and income in the long-run. oil demand is found to be elastic with respect to income at the aggregate level but inelastic with respect to prices at the aggregate and industrial level. coal demand is also inelastic with respect to price, but elastic with respect to income. the impulse response and forecast error decomposition analyses based on cointegrated var model corroborate the results of cointegration tests.