Fuel Economy and Safety: The Influences of Vehicle Class and Driver Behavior
AbstractFuel economy standards change the composition of the vehicle fleet, potentially influencing accident safety. I introduce a model of the fleet that captures risks across interactions between vehicle types while simultaneously recovering estimates of unobserved driving safety behavior. The model importantly includes the ability to consider the selection of driver types across vehicles. I apply the model to the present structure of U.S. fuel economy standards and find an adverse effect on safety: Each MPG increment to the standard results in an additional 149 fatalities per year in expectation. I next show how two alternative regulatory provisions, including one slated to enter effect next year, can fully offset the negative safety consequences; minor changes in the regulation produce a robust, near-zero change in accident fatalities while conserving the same quantity of gasoline.
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Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 18012.
Date of creation: Apr 2012
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- L9 - Industrial Organization - - Industry Studies: Transportation and Utilities
- Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
- Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-05-02 (All new papers)
- NEP-ENE-2012-05-02 (Energy Economics)
- NEP-HEA-2012-05-02 (Health Economics)
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