The Price of Gasoline and the Demand for Fuel Economy: Evidence from Monthly New Vehicles Sales Data

Klier, Thomas; Linn, Joshua

doi:10.2139/ssrn.1514554

Cited by 19 publications

(24 citation statements)

References 22 publications

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“…We instrument for a vehicle's endogenous characteristics using the engine characteristics of vehicles located in different classes that have the same engine. Combined with the estimated demand for fuel efficiency that we report in Klier and Linn (2008), the results imply that consumers are willing to pay roughly the same amount for a proportional increase in power as for fuel efficiency.…”

Section: Introductionsupporting

confidence: 53%

“…Estimating the demand for fuel efficiency, D β , is straightforward, using the same approach as Klier and Linn (2008). Specifically, we use within model-year variation in gasoline prices and sales to estimate D β , which controls for unobserved vehicle model-specific parameters, jt ξ .…”

Section: The New Vehicles Marketmentioning

confidence: 99%

“…Similarly to Austin and Dinan (2005), the elasticities of costs to weight and engine technology are estimated using data on the costs and efficacy of engine and weight reduction technologies from NHTSA (2008). 15 It is important to note that in the medium run analysis, only a limited set of engine technologies can be adopted. Therefore, the elasticity of costs to engine technology is greater in the medium run than in the long run (the short run elasticity is infinite).…”

Section: Medium Run Effects (Preliminary)mentioning

confidence: 99%

“…The differences between the short and medium run 14 We assume throughout that there are no economies of scale, so that marginal costs only depend on vehicle characteristics. 15 The constant terms in the cost and technology equations are estimated using the initial fuel efficiency and marginal cost of each model (i.e., before the increase in the standard). The final fuel efficiency and marginal cost are calculated using the deviations from the initial values of power, weight and technology.…”

Section: Medium Run Effects (Preliminary)mentioning

confidence: 99%

See 3 more Smart Citations

New Vehicle Characteristics and the Cost of the Corporate Average Fuel Economy Standard

Klier

Linn

2008

SSRN Journal

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Section: Introductionsupporting

confidence: 53%

Section: The New Vehicles Marketmentioning

confidence: 99%

Section: Medium Run Effects (Preliminary)mentioning

confidence: 99%

Section: Medium Run Effects (Preliminary)mentioning

confidence: 99%

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New Vehicle Characteristics and the Cost of the Corporate Average Fuel Economy Standard

Klier

Linn

2008

SSRN Journal

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“…We also show that the market share of compact cars increases by 24 percent for every also show that the market share of compact cars increases by 24 percent for every $1 increase in gasoline prices, while the market share of sport-utility vehicles falls by $1 increase in gasoline prices, while the market share of sport-utility vehicles falls by 14 percent. Klier and Linn (2010) estimate a logit demand system and focus on the 14 percent. Klier and Linn (2010) estimate a logit demand system and focus on the effects of changes in a vehicle's cost per mile on demand.…”

Section: Improved Fuel Economymentioning

confidence: 99%

Reducing Petroleum Consumption from Transportation

Knittel

2012

Journal of Economic Perspectives

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The United States consumes more petroleum-based liquid fuel per capita than any other OECD high-income country—30 percent more than the second-highest country (Canada) and 40 percent more than the third-highest (Luxembourg). The transportation sector accounts for 70 percent of U.S. oil consumption and 30 percent of U.S. greenhouse gas emissions. Taking the externalities associated with high U.S. gasoline consumption as largely given, I focus on understanding the policy tools that seek to reduce this consumption. I consider four main channels through which reductions in U.S. oil consumption might take place: 1) increased fuel economy of existing vehicles, 2) increased use of non-petroleum-based, low-carbon fuels, 3) alternatives to the internal combustion engine, and 4) reduced vehicle miles traveled. I then discuss how these policies for reducing petroleum consumption compare with the standard economics prescription for using a Pigouvian tax to deal with externalities. Taking into account that energy taxes are a political hot button in the United States, and also considering some evidence that consumers may not "correctly" value fuel economy, I offer some thoughts about the margins on which policy aimed at reducing petroleum consumption might usefully proceed.

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Why pay for sustainable housing? Decomposing the green premium of the residential property market in the Canton of Zurich, Switzerland

Kempf

Syz

2022

SN Bus Econ

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Various studies have shown that green buildings trade at a premium, with estimates of it ranging widely from low single-digits up to 26% for sales values and up to 21% for rents. There is, however, little quantified evidence of why people are willing to pay more for sustainable housing. We investigate the green premium for MINERGIE-certified residential properties in the Canton and City of Zurich, which have among the highest densities of certified green buildings worldwide. Using a comprehensive data set of 17,743 condominiums for sale and 50,075 apartments for rent, we show that the premium can be decomposed and associated with various benefits for owners and tenants. The overall green premia in the canton amount to 2.45% and in the city to 4.91%. From these total premia, 6% (city: insignificant) are attributed to energy savings, 71% (city: 70%) to increased comfort, and 23% (city: 33%) to making the building future proof against regulators and market participants.

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The Price of Gasoline and the Demand for Fuel Economy: Evidence from Monthly New Vehicles Sales Data

Cited by 19 publications

References 22 publications

New Vehicle Characteristics and the Cost of the Corporate Average Fuel Economy Standard

New Vehicle Characteristics and the Cost of the Corporate Average Fuel Economy Standard

Reducing Petroleum Consumption from Transportation

Why pay for sustainable housing? Decomposing the green premium of the residential property market in the Canton of Zurich, Switzerland

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