Member Login

Energy Journal Issues

IAEE Members and subscribers to The Energy Journal: Please log in to access the full text article or receive discounted pricing for this article.

View Cart  

Price: $25    Add to Cart

Fuel Efficiency and Motor Vehicle Travel: The Declining Rebound Effect
Author(s): Kenneth A. Small, Kurt Van Dender

The Quarterly Journal of the IAEE's Energy Economics Education Foundation
Volume 28, Number 1

Abstract: We estimate the rebound effect for motor vehicles, by which improved fuel efficiency causes additional travel, using a pooled cross section of US states for 1966-2001. Our model accounts for endogenous changes in fuel efficiency, distinguishes between autocorrelation and lagged effects, includes a measure of the stringency of fuel-economy standards, and allows the rebound effect to vary with income, urbanization, and the fuel cost of driving. At sample averages of variables, our simultaneous-equations estimates of the short- and long-run rebound effect are 4.5% and 22.2%. But rising real income caused it to diminish substantially over the period, aided by falling fuel prices. With variables at 1997-2001 levels, our estimates are only 2.2% and 10.7%, considerably smaller than values typically assumed for policy analysis. With income and starting fuel efficiency at 1997-2001 levels and fuel prices 58 percent higher, the estimates are still only 3.1% and 15.3%, respectively.
Energy Specializations: Energy and the Environment - Climate Change and Greenhouse Gases, Energy Modeling - Energy Data, Modeling, and Analysis, Energy and the Economy - Energy and Economic Growth / Performance, Petroleum - Crude Oil and Product Markets and Prices,

Keywords: Carbon dioxide, Fuel economy, travel demand, motor vehicle use, rebound effect, US,
Pages:25-52
DOI: 10.5547/ISSN0195-6574-EJ-Vol28-No1-2
View Issue Table of Contents
 


Article Tools

Export Citation
Order physical issue

Prev Article Next Article