Transportation Fuel Use, Technology and Standards : The Role of Credibility and Expectations

There is a debate among policy analysts about whether fuel taxes alone are the most effective policy to reduce fuel use by motorists, or whether to also use mandatory standards for fuel efficiency. A problem with a policy mandating fuel economy standards is the "rebound effect," whereby owners with more efficient vehicles increase vehicle usage. If an important part of negative externalities from transport are associated with vehicle kilometers (accidents, congestion, road wear) rather than fuel consumption, the rebound effect increases negative externalities. Taxes and standards should be mutually supportive because fuel taxes often meet political resistance. Over time, fuel efficiency standards can reduce political resistance to fuel taxes. Thus, by raising fuel efficiency standards now, politicians may be able to pursue higher fuel tax paths in the future. Another argument in support of fuel efficiency standards and similar policies is that standards to a greater extent than taxes can be announced in advance and still be credible and change the behavior of inventors, firms, and other agents in society. A further argument is that standards can be used with greater force and commitment through international coordination.

Bibliographic Details

Main Authors:	Eskeland, Gunnar S., Mideksa, Torben K.
Language:	English
Published:	World Bank, Washington, DC 2008-08
Subjects:	ACCIDENTS, AIR, AIR POLLUTION, AIR QUALITY, ALTERNATIVE POLICIES, APPROACH, AUTO MANUFACTURERS, AUTOMOBILE, AUTOMOBILE FUEL, AUTOMOTIVE FUEL, AVERAGE FUEL EFFICIENCY, BUS, BUS SYSTEMS, BUSES, CAPITAL GAINS, CAPITAL GOODS, CAR, CAR FLEET AVERAGE, CAR INDUSTRY, CAR MILEAGE, CAR OWNERSHIP, CAR OWNERSHIP RATES, CAR SALES, CAR TECHNOLOGY, CAR USE, CARBON, CARBON DIOXIDE, CARBON DIOXIDE EMISSIONS, CARBON EMISSIONS, CARS, CERTIFICATION STANDARDS, CHOICE OF FUEL, CLEAN TRANSPORTATION, CLIMATE CHANGE, CLIMATE CHANGE POLICY, CO2, CO2 EMISSIONS, CONGESTION, CONSUMPTION OF FUEL, COST BENEFIT ANALYSIS, COST EFFECTIVE POLICIES, COST EFFECTIVENESS, COST OF GASOLINE, COSTS OF FUEL, COSTS OF TRAVEL, CRASHES, DEMAND CURVE, DEMAND ELASTICITIES, DEMAND ELASTICITY, DEMAND FOR ENERGY, DEMAND FOR GASOLINE, DIESEL, DISCOUNT RATES, DISPOSABLE INCOME, DIVIDENDS, DRIVING, DRIVING FORCE, DRIVING RESTRICTIONS, ECONOMIC PERSPECTIVES, ECONOMISTS, EFFICIENT VEHICLES, ELASTICITIES, ELASTICITIES OF DEMAND, ELASTICITY OF DEMAND, ELASTICITY OF TRAVEL, EMISSION, EMISSION CONTROL, EMISSION RATE, EMISSION REDUCTION, EMISSION REDUCTIONS, EMISSION STANDARDS, EMISSION TAXES, EMISSIONS, EMISSIONS OF POLLUTANTS, EMPIRICAL RESEARCH, EMPIRICAL STUDIES, ENERGY CONSERVATION, ENERGY CONSUMPTION, ENERGY EFFICIENCY, ENERGY SHORTAGE, ENERGY SUPPLY, ENERGY USE, ENVIRONMENTAL, ENVIRONMENTAL ECONOMICS, ENVIRONMENTAL PROTECTION, EQUILIBRIUM, EXTERNAL COSTS, EXTERNAL COSTS OF TRANSPORT, EXTERNALITIES, FISHERIES, FIXED COSTS, FOSSIL, FOSSIL FUEL, FOSSIL FUEL USE, FUEL CONSERVATION, FUEL CONSUMPTION, FUEL COST, FUEL DEMAND, FUEL ECONOMY, FUEL ECONOMY STANDARDS, FUEL EFFICIENCY, FUEL EFFICIENCY IMPROVEMENTS, FUEL EFFICIENCY STANDARDS, FUEL EFFICIENT CARS, FUEL PRICE, FUEL PRICES, FUEL SAVINGS, FUEL STANDARDS, FUEL TAX, FUEL TAX INCREASE, FUEL TAX INCREASES, FUEL TAXATION, FUEL TAXES, FUEL TYPES, FUEL USE, FUELS, GAS GUZZLER TAX, GAS TAX, GAS TAXES, GASOLINE, GASOLINE CONSUMPTION, GASOLINE DEMAND, GASOLINE PRICE, GASOLINE PRICES, GASOLINE TAX, GASOLINE TAXES, GLOBAL ENVIRONMENT, GOODS TRANSPORT, GREENHOUSE GAS, GREENHOUSE GAS EMISSION, GREENHOUSE GAS EMISSION REDUCTIONS, GREENHOUSE GAS EMISSIONS, GREENHOUSE GASES, HEAVY VEHICLES, IMPROVEMENT IN FUEL EFFICIENCY, IMPROVEMENTS IN ENERGY EFFICIENCY, IMPROVEMENTS IN FUEL EFFICIENCY, INCOME LEVELS, INSURANCE, LIGHT TRUCKS, LOCAL AIR POLLUTANTS, MARGINAL COST, MARGINAL COSTS, MARKET PRICES, MILEAGE, MOTOR VEHICLE, MOTOR VEHICLE EMISSIONS, MOTOR VEHICLE FUEL, MOTOR VEHICLES, MOTORISTS, NATIONAL OIL, NEGATIVE EXTERNALITIES, NOISE, OIL, OIL CONSUMPTION, OIL EMBARGOES, OIL EXPORTING COUNTRIES, OIL PRICE, OIL PRICES, OIL SUPPLY, PASSENGER CARS, PEDESTRIANS, PERSONAL VEHICLES, PETROLEUM, PETROLEUM USE, POLICY INSTRUMENTS, POLICY MAKERS, POLITICAL ECONOMY, POLLUTERS, POLLUTION, POLLUTION CONTROL, POLLUTION CONTROL POLICIES, PRICE CHANGES, PRICE ELASTICITIES, PRICE ELASTICITY, PRIVATE SECTOR, PRODUCERS, PROPERTY RIGHTS, PUBLIC TRANSPORT, PURCHASES, QUOTAS, RATIONAL EXPECTATIONS, REAL RATE OF INTEREST, ROAD, ROAD SPACE, ROAD USER, ROAD USER CHARGES, SAFETY, SOCIAL COSTS, SUSTAINABLE TRANSPORT, TAX RATE, TAX RATES, TECHNOLOGICAL CHANGE, TRAFFIC, TRAFFIC ACCIDENTS, TRAFFIC FATALITIES, TRANSPORT, TRANSPORT INFRASTRUCTURE, TRANSPORTATION, TRANSPORTATION FUEL, TRANSPORTATION FUEL USE, TRANSPORTATION FUELS, TRANSPORTATION SERVICES, TRAVEL DEMAND, TRIPS, TRUCKS, VEHICLE, VEHICLE FUEL EFFICIENCY, VEHICLE KILOMETERS, VEHICLE KILOMETRES, VEHICLE MILES, VEHICLE MODEL, VEHICLE USAGE, VEHICLE USE, WELFARE ECONOMICS, WELFARE GAINS, WILLINGNESS TO PAY, WORLD MARKET PRICES,
Online Access:	http://documents.worldbank.org/curated/en/2008/08/9778611/transportation-fuel-use-technology-standards-role-credibility-expectations https://hdl.handle.net/10986/6793
Tags:	Add Tag No Tags, Be the first to tag this record!