Invisible Hand on the Pump

Gasoline prices have spiked to the highest levels ever seen in the USofA, somewhere between $3.60 and $3.80 per gallon (about $1.00 per litre). That causes a lot of pain for people who drive 40k miles per year at 20 miles per gallon (pretty close to the average for commuters) and run up a tab of over $600 a month for gasoline alone. But will this change anything? Is there any evidence that higher gasoline prices will encourage conservation?

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