Automobile Fuel Economy Standards: Impacts, Efficiency, and Alternatives
31 Pages Posted: 20 Sep 2010 Last revised: 25 May 2013
Date Written: September 2010
This paper discusses fuel economy regulations in the United States and other countries. We first describe how these programs affect the automobile market, including their impacts on fuel use and other dimensions of the vehicle fleet. We then review different methodologies for assessing the costs of fuel economy regulations and discuss what the results of these methodologies imply for policy. Following that, we compare the welfare effects of fuel economy regulations to those of fuel taxes and assess whether or not these two policies can be complements. Finally, we review arguments for transitioning away from fuel economy regulations towards a "feebate" system.
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