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An Indirect Utility Model of Multiple Car Ownership and Use

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Author Info

  • Jan Rouwendal

    ()
    (Faculty of Economics and Business Administration, Vrije Universiteit Amsterdam)

  • John Pommer

    ()
    (Connekt, Delft)

Abstract

The number of households with two or more cars is steadily increasing over time. The reason is that ownership of a single car imposes restrictions on car use when there are multiple license holders in a household. If such restrictions are severe, the benefits of multiple-car ownership may exceed the additional costs involved. In this paper, we develop a model that is based on the idea that limited substitutability between car use of different drivers is the driving force behind multiple-car ownership. We formulate a model structure in which households can own and use multiple cars. This approach is used to generalize an existing model for ownership and use of a single car two multiple car ownership and use. The extended model is estimated on Dutch data concerning households with one or two cars. An application to the effects of shifting the burden of car taxes from fixed to variable costs is provided.

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Bibliographic Info

Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 04-085/3.

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Date of creation: 16 Aug 2004
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Handle: RePEc:dgr:uvatin:20040085

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Web page: http://www.tinbergen.nl

Related research

Keywords: automobile demand; multiple car ownership; demand for car kilometers;

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  1. Mannering, Fred L. & Train, Kenneth, 1985. "Recent directions in automobile demand modeling," Transportation Research Part B: Methodological, Elsevier, vol. 19(4), pages 265-274, August.
  2. Neary, J.P & Roberts, K.W.S, 1978. "The Theory of Household Behaviour under Rationing," The Warwick Economics Research Paper Series (TWERPS) 132, University of Warwick, Department of Economics.
  3. Rouwendal, Jan & de Vries, Frans, 1999. "The taxation of drivers and the choice of car fuel type," Energy Economics, Elsevier, vol. 21(1), pages 17-35, February.
  4. Hensher, David A., 1985. "An econometric model of vehicle use in the household sector," Transportation Research Part B: Methodological, Elsevier, vol. 19(4), pages 303-313, August.
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