Policy Watch: Corporate Average Fuel Economy Standards

Vehicle Greenhouse Gas Emissions and Corporate Average Fuel Economy Standards

Corporate Average Fuel Economy Standards and the Market for New Vehicles

This paper presents an overview of the economics literature on the effect of Corporate Average Fuel Economy (CAFE) standards on the new vehicle market. Since 1978, CAFE has imposed fuel economy standards for cars and light trucks sold in the U.S. market. This paper reviews the history of the standards, followed by a discussion of the major upcoming changes in implementation and stringency. It d...

Vehicle Miles Traveled, Fuel Economy Efficiency And Costs of Corporate Average Fuel Economy Standard

This paper investigates how fuel economy efficiency affects household vehicle mileage traveled and its distribution. Using a detailed micro-level data of National Household Travel Survey 2001 and 2008, we estimated a recursive structural model for joint determination of vehicle fuel efficiency choice and vehicle mileage traveled each year. We further studied the distributional effects on vehicl...

A structural analysis of vehicle design responses to Corporate Average Fuel Economy policy

= 248 words Total length = 5,479 + 250 * 8 (6 Figures + 2 Tables) = 7,479 words Shiau, Michalek, and Hendrickson 1 ABSTRACT The U.S. Corporate Average Fuel Economy (CAFE) regulations, which aim to influence automaker vehicle design and pricing responses, have been imposed for thirty years, with new target regulations enacted in 2007. We present a structural analysis of automaker responses to ge...

Are Fuel Economy Standards Regressive?

Despite widespread agreement that a carbon tax would be more efficient, many countries use fuel economy standards to reduce transportation-related carbon dioxide emissions. We pair a simple model of the automakers’ profit maximization problem with unusually-rich nationally representative data on vehicle registrations to estimate the distributional impact of U.S. fuel economy standards. The key ...