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Energy policy in transport and transport policy

  • Van Dender, Kurt
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    Explanations for, and indirect evidence of, imperfections in the market for private passenger vehicle fuel economy suggest there is a reasonable case for combining fuel economy standards and fuel or carbon taxes to contribute to an energy policy that aims to reduce greenhouse gas emissions and improve energy security. Estimates of key elasticities, including the rebound effect, indicate that the positive and negative side-effects of fuel economy measures on transport activities and external costs are limited. However, an energy policy for transport does not replace a transport policy that aims to manage the main transport externalities including congestion and local pollution. Conventional marginal cost estimates and standard cost-benefit reasoning suggest that policies that address congestion and local pollution likely bring benefits at least as large as those from fuel economy measures. But the large uncertainty on the possible effects of greenhouse gas emissions constitutes a strong challenge for standard cost-benefit reasoning. Emerging results from methods to cope with this uncertainty suggest that policies to stimulate the widespread adoption of low-carbon technologies in transport are justified.

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    Article provided by Elsevier in its journal Energy Policy.

    Volume (Year): 37 (2009)
    Issue (Month): 10 (October)
    Pages: 3854-3862

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    Handle: RePEc:eee:enepol:v:37:y:2009:i:10:p:3854-3862
    Contact details of provider: Web page: http://www.elsevier.com/locate/enpol

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    1. Parry, Ian W.H., 2007. "Are the costs of reducing greenhouse gases from passenger vehicles negative?," Journal of Urban Economics, Elsevier, vol. 62(2), pages 273-293, September.
    2. Turrentine, Thomas S. & Kurani, Kenneth S., 2007. "Car buyers and fuel economy?," Energy Policy, Elsevier, vol. 35(2), pages 1213-1223, February.
    3. Tol, Richard S. J., 2005. "The marginal damage costs of carbon dioxide emissions: an assessment of the uncertainties," Energy Policy, Elsevier, vol. 33(16), pages 2064-2074, November.
    4. Jonathan E. Hughes & Christopher R. Knittel & Daniel Sperling, 2006. "Evidence of a Shift in the Short-Run Price Elasticity of Gasoline Demand," NBER Working Papers 12530, National Bureau of Economic Research, Inc.
    5. Parry, Ian & Small, Kenneth, 2002. "Does Britain or the United States Have the Right Gasoline Tax?," Discussion Papers dp-02-12-, Resources For the Future.
    6. Kenneth A. Small & Kurt van Dender, 2007. "Long Run Trends in Transport Demand, Fuel Price Elasticities and Implications of the Oil Outlook for Transport Policy," OECD/ITF Joint Transport Research Centre Discussion Papers 2007/16, OECD Publishing.
    7. Molly Espey & Santosh Nair, 2005. "Automobile Fuel Economy: What Is It Worth?," Contemporary Economic Policy, Western Economic Association International, vol. 23(3), pages 317-323, 07.
    8. Kenneth A. Small & Kurt Van Dender, 2006. "Fuel Efficiency and Motor Vehicle Travel: The Declining Rebound Effect," Working Papers 050603, University of California-Irvine, Department of Economics.
    9. Parry, Ian W.H. & Walls, Margaret & Harrington, Winston, 2007. "Automobile Externalities and Policies," Discussion Papers dp-06-26, Resources For the Future.
    10. Glazer, Amihai & Lave, Charles, 1996. "Regulation by Prices and by Command," Journal of Regulatory Economics, Springer, vol. 9(2), pages 191-97, March.
    11. William D. Nordhaus, 2007. "A Review of the Stern Review on the Economics of Climate Change," Journal of Economic Literature, American Economic Association, vol. 45(3), pages 686-702, September.
    12. Stef Proost & Kurt Van Dender & Christoph Courcelle & John Peirson & Duncan Sharp, 2001. "How large is the gap between present and efficient transport prices in Europe?," Chapters, in: Reforming Transport Pricing in the European Union, chapter 17 Edward Elgar.
    13. Martin L. Weitzman, 2007. "A Review of the Stern Review on the Economics of Climate Change," Journal of Economic Literature, American Economic Association, vol. 45(3), pages 703-724, September.
    14. Turrentine, Tom & Kurani, Kenneth S, 2007. "Car buyers and fuel economy?," Institute of Transportation Studies, Working Paper Series qt56x845v4, Institute of Transportation Studies, UC Davis.
    15. Stef Proost, 2008. "Full Account of the Costs and Benefits of Reducing CO2 Emissions in Transport," OECD/ITF Joint Transport Research Centre Discussion Papers 2008/3, OECD Publishing.
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