Gas Price * USA - Understanding Volatility

Consumers frustrated at fast rise but slow descent of gas prices

New York,NY,USA -MSNBC/Red Tape- April 25, 2011: -- In perfect free market, prices should float up and down w/ equal speed. Basically, when prices go up, retailers have to act quickly or they lose money... 1997 study found prices fall about twice as slow as they rise... Basic economic theory doesn't explain sharp rise-slow fall price pattern. Some suggest greedy station owners take advantage of temporary high prices... Consumers call it price gouging; economists say "asymmetric price adjustment"...  Ohio State University economist, Matt Lewis, doesn't discount allegations like price fixing, collusion. But he thinks consumers aren't as fussy when gas prices start to fall. Lewis said "Consumers shop around more intensely when prices are going up. When they are falling, they don't shop around as much" ...  Leads to less competition; stations have no urgency in lowering prices...