IDEAS home Printed from https://ideas.repec.org/a/eee/eneeco/v126y2023ics0140988323005303.html
   My bibliography  Save this article

Gasoline price and fuel economy of new automobiles: Evidence from Chinese cities

Author

Listed:
  • Xu, Jiayi
  • Tan-Soo, Jie-Sheng
  • Chu, Yanlai
  • Zhang, Xiao-Bing

Abstract

With climate change and energy security being global issues, improvements in passenger vehicles' fuel economy can greatly aid in reducing gasoline usage and mitigating carbon emissions. This paper examines the effect of gasoline price on overall automobile sales, and its role in affecting the types of vehicles purchased by Chinese consumers. Based on monthly model-level sales data for 31 major cities in China from 2013 to 2019, we find that increased gasoline price not only reduces total sales quantity, but also alters fleet composition as consumers purchase more fuel-efficient cars, and less of their inefficient counterparts. However, an essential question remains: To what extent does gasoline price affect greenhouse gas emissions? Policy simulations based on our findings show that a 1 CNY/L increase in gasoline price leads to a relatively modest improvement in fleet fuel economy of new automobiles by about 0.13 L/100 km (around 1.7% improvement). In turn, this improvement in fuel economy leads to a reduction of the annual carbon emission by 3.64%.

Suggested Citation

  • Xu, Jiayi & Tan-Soo, Jie-Sheng & Chu, Yanlai & Zhang, Xiao-Bing, 2023. "Gasoline price and fuel economy of new automobiles: Evidence from Chinese cities," Energy Economics, Elsevier, vol. 126(C).
    • Handle: RePEc:eee:eneeco:v:126:y:2023:i:c:s0140988323005303
    DOI: 10.1016/j.eneco.2023.107032
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0140988323005303
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.eneco.2023.107032?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:eneeco:v:126:y:2023:i:c:s0140988323005303. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eneco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.