The principal-agent problem and transport energy use: Case study of company lease cars in the Netherlands
Barriers exist for improvement of energy efficiency, of which the principal-agent problem is considered an important one. The principal-agent problem is a potential barrier for energy policies based on economic instruments, as the decision maker may be partially insulated from the price signal given by such policies. We estimate the size and the impact of the principal-agent problem for cars provided by companies as a benefit to employees in the Netherlands. Of all passenger cars in the Netherlands, 11% is classified as company cars, which consume 21% of the total energy consumption by passenger cars. As company cars are newer, operate more diesel engines, but are also larger, the fuel efficiency is slightly worse than that of private cars. Company cars seem to drive longer distances for commuting than the national average of private cars. Together, this might result in a net 1-7% increase of all fuel use of passenger cars in the Netherlands. This indicates that there is potential to reduce energy consumption of company cars and a need for policies aimed at improving energy efficiency of company cars.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- DeCanio, Stephen J., 1993. "Barriers within firms to energy-efficient investments," Energy Policy, Elsevier, vol. 21(9), pages 906-914, September.
- B. Howarth, Richard & Haddad, Brent M. & Paton, Bruce, 2000. "The economics of energy efficiency: insights from voluntary participation programs," Energy Policy, Elsevier, vol. 28(6-7), pages 477-486, June.
- Jonathan G. Koomey & Alan H. Sanstad & Leslie J. Shown, 1996. "Energy-Efficient Lighting: Market Data, Market Imperfections, And Policy Success," Contemporary Economic Policy, Western Economic Association International, vol. 14(3), pages 98-111, 07.
- Farla, Jacco C.M & Blok, Kornelis, 2000. "The use of physical indicators for the monitoring of energy intensity developments in the Netherlands, 1980–1995," Energy, Elsevier, vol. 25(7), pages 609-638.
- Stephen Decanio, 1994. "Agency and Control Problems in US Corporations: The Case of Energy-efficient Investment Projects," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 1(1), pages 105-124.
When requesting a correction, please mention this item's handle: RePEc:eee:enepol:v:36:y:2008:i:10:p:3745-3753. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If references are entirely missing, you can add them using this form.