Elasticity of Vehicle Miles of Travel to Changes in the Price of Gasoline and the Cost of Driving in Texas

Wenzel, Tom; Fujita, K. Sydny

doi:10.2172/1827675

Cited by 3 publications

(1 citation statement)

References 10 publications

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“…The 2018 benefit-cost analysis uses a larger estimate of the rebound effect (20 percent) than the 2016 benefit-cost analysis (10 percent), despite recent evidence from the academic literature that finds smaller rebound effects. For example, West et al (2017) find a zero percent rebound effect; Langer et al (2017) estimate a rebound effect of 11 percent; Knittel and Sandler (2018) find 14.7 percent; and Wenzel and Fujita (2018) estimate a range of 7.5-15.9 percent. In the 2018 NPRM, the higher rebound effect of 20 percent leads to increased private driving benefits from the CAFE standard that are approximately equal to costs from the associated increase in accidents and pollution.…”

Section: Application To the 2018 Proposal To Roll Back Fuel-economy S...mentioning

confidence: 99%

Estimating the Costs and Benefits of Fuel-Economy Standards

Bento¹,

Jacobsen²,

Knittel³

et al. 2020

Environmental and Energy Policy and the Economy

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Fuel-economy standards for new vehicles are a primary policy instrument in many countries to reduce the carbon footprint of the transportation sector. These standards have many channels of costs and benefit, impacting sales, composition, vehicle attributes, miles traveled and externalities in the new-car fleet, as well as the composition and size of the used fleet. We develop a tractable analytical framework to examine the welfare effects of fuel-economy standards, and apply it to the recent government proposal to roll back fuel-economy standards. We find that our combined, multi-market vehicle choice model implies that the proposal would increase the size of the vehicle fleet over time, and also generates smaller welfare gains than models with a less rich structure of the vehicle market, such as the one used in the analysis associated with the 2018 Notice of Proposed Rulemaking (NPRM) announcement. The disparities across the two models appear to result from the absence of feedback effects in the NPRM analysis. We stress the importance of instead using a multi-market vehicle choice model to provide the most accurate predictions of costs and benefits. We also derive bounds that can serve as a check on the theoretical consistency of such analyses, and that offer insights into the magnitudes of potential errors resulting from imperfect multi-market integration.

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Section: Application To the 2018 Proposal To Roll Back Fuel-economy S...mentioning

confidence: 99%

Estimating the Costs and Benefits of Fuel-Economy Standards

Bento¹,

Jacobsen²,

Knittel³

et al. 2020

Environmental and Energy Policy and the Economy

View full text Add to dashboard Cite

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Generational travel patterns in the United States: New insights from eight national travel surveys

Zhang¹,

Li²

2022

Transportation Research Part A: Policy and Practice

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Income and Geographic Distribution of a Vehicle Miles Traveled Fee: Case Study of Four States

Rahman,

Ju,

Burris

2024

Transportation Research Record: Journal of the Transportation R

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The transportation sector in the United States has faced funding challenges owing to a stagnant federal fuel tax rate and rising vehicle fuel economy. To address this issue, policy makers have explored the potential of a vehicle miles traveled (VMT) fee as an alternative funding method. However, equity concerns remain across income and geographic groups. This study explored equity issues with a VMT fee for different income levels and two geographic groups (urban and rural), in four states (California [CA], Iowa [IA], New York [NY], and Texas [TX]). Using 2009 and 2017 National Household Travel Survey data, the study analyzed VMT demand elasticity using structural equation modeling and applied it to VMT fee scenarios. The results showed that the current fuel tax system charges higher-income and urban households more than lower-income and rural households, whereas the VMT fee system reduced these differences a small amount. Households in CA, IA, NY, and TX paid, on average, $10, $5, $2, and $2 less per year with the VMT fee, respectively, compared with the current fuel tax system. This is primarily since electric vehicles will also pay the VMT fee. Most importantly, the difference in the amount paid changed very little under a VMT fee for the different income and geographic traveler segments, potentially alleviating some equity concerns.

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Elasticity of Vehicle Miles of Travel to Changes in the Price of Gasoline and the Cost of Driving in Texas

Cited by 3 publications

References 10 publications

Estimating the Costs and Benefits of Fuel-Economy Standards

Estimating the Costs and Benefits of Fuel-Economy Standards

Generational travel patterns in the United States: New insights from eight national travel surveys

Income and Geographic Distribution of a Vehicle Miles Traveled Fee: Case Study of Four States

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