|
|
Article: AUTOMOBILE FUEL ECONOMY: WHAT IS IT WORTH?
- Article from:
- Contemporary Economic Policy
- Article date:
- July 1, 2005
- Author:
CopyrightCopyright Western Economic Association Jul 2005. Provided by ProQuest LLC. (Hide copyright information)
|
The marginal value of increased automobile fuel economy is estimated using a hedonic model of 2001 model year automobiles sold in the United States. This value is then compared to the average expected lifetime fuel savings attributable to increased fuel economy. Results indicate that automobile buyers fully internalize fuel cost savings attributable to improved fuel economy at low discount rates, and may partially internalize other perceived benefits of improved fuel economy such as reduction in global warming or fossil fuel dependence.
I. INTRODUCTION
Concern about energy efficiency touches a broad cross section of the populace. Supporters of increased automobile fuel economy cite global ...