Car-Fuel Poverty: Determinants and Policy Implications for France

33 Pages Posted: 19 Oct 2023

See all articles by Ariane Bousquet

Ariane Bousquet

Université d'Évry; Renault

María Eugenia Sanin

Université Paris Saclay

Date Written: September 25, 2023

Abstract

Several European governments implemented a generalized gasoline subsidy in the face of inflation following the Ukrainian crisis. In contrast, reducing fossil fuel consumption is crucial to mitigate the current energy and climate crises. Fuel consumption for transport increases with income, making rich households the main beneficiaries of generalized subsidies. In this context, a thorough investigation of the nature of vulnerability to rising gasoline prices is needed to formulate targeted policies. Herein, we contribute in this line for the case of France. Firstly, we develop three metrics of car-fuel poverty. Secondly, we use multivariate statistical analysis to identify car-fuel-poor household profiles. Then, we estimate the socioeconomic determinants of such vulnerability. We find that aside from income, household composition, region, access to public transport, and house ownership significantly impact the probability of being car-fuel-poor. Then, using our results, we evaluate the impact of recent subsidies implemented in France and suggest alternative targeted policies. We find that the policies that have been implemented are regressive and incur inclusion and exclusion errors. Instead, a targeted subsidy fully compensating the car-fuel-poor would have been efficient implying, at the same time, important government savings.

Keywords: car-fuel povert, transport poverty, fuel poverty, Inclusion, France, Europe

JEL Classification: I32, Q41, Q48, Q58

Suggested Citation

Bousquet, Ariane and Sanin, Maria Eugenia, Car-Fuel Poverty: Determinants and Policy Implications for France (September 25, 2023). Available at SSRN: https://ssrn.com/abstract=4578578 or http://dx.doi.org/10.2139/ssrn.4578578

Ariane Bousquet (Contact Author)

Université d'Évry ( email )

Bd. François Mitterrand
F-91025 Evry Cedex, 91028
France

Renault ( email )

Boulogne-Billancourt
Hauts-de-Seine
Paris
France

Maria Eugenia Sanin

Université Paris Saclay

France

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