For the curve depends upon the various elasticities and we know that long term elasticities are higher than short term.

FORBES: Laffer Curve Spotted in the Wild in Eire

According to Drum, these elasticities mean that, in the short term, a 50 percent increase in price leads to a 1.2 percent decrease in consumption.

FORBES: Raising Gas Taxes Wouldn't Cut Consumption, But It Still Makes Sense

Conservative blogger Jim Manzi rightly points out that, with elasticities as low as these, a gas tax at any politically realistic level is not going to reduce our dependence on fossil fuels.

FORBES: Raising Gas Taxes Wouldn't Cut Consumption, But It Still Makes Sense

In response, several bloggers have argued that these elasticities are underestimated, pointing to the unreliability of estimates of long-run price elasticity of oil demand in general and to other literature with higher estimates than the IMF study.

FORBES: Raising Gas Taxes Wouldn't Cut Consumption, But It Still Makes Sense