Automobile Fuel Economy Standards: Impacts, Efficiency, and Alternatives

Soren T. Anderson, Carolyn Fischer, Ian Parry, James M. Sallee

NBER Working Paper No. 16370
Issued in September 2010
NBER Program(s):   EEE   PE

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.

Published: Soren T. Anderson & Ian W. H. Parry & James M. Sallee & Carolyn Fischer, 2011. "Automobile Fuel Economy Standards: Impacts, Efficiency, and Alternatives," Review of Environmental Economics and Policy, Oxford University Press for Association of Environmental and Resource Economists, vol. 5(1), pages 89-108, Winter.

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