IDEAS home Printed from https://ideas.repec.org/a/eee/retrec/v110y2025ics0739885925000253.html

Transport emissions, carbon taxes, and modal choice

Author

Listed:
  • Avetisyan, Misak
  • Wilson, Wesley W.

Abstract

Transportation is one of the major sources of anthropogenic emissions. Yet most environmental regulations target production emissions rather than transportation emissions. Within the transport sector, there are considerable differences in emissions intensities across modes. In this paper, we develop and estimate a multinomial logit model of consumer mode choices for non-local travel using the 2017 Household Travel Survey to consider the impacts of carbon taxes on mode choices and emissions. The model is specified as a function of trip cost, travel distance, and a variety of household characteristics. The estimates are then used to calculate the impacts of incremental carbon taxes from none to $150/tCO2 on both modal choices and emissions. We find that there are mode shifts to more fuel-efficient modes along with reductions in emissions as taxes increase. We also find almost linear relationship between carbon prices and abatement of non-local transport emissions with the largest reduction observed under $150/tCO2.

Suggested Citation

  • Avetisyan, Misak & Wilson, Wesley W., 2025. "Transport emissions, carbon taxes, and modal choice," Research in Transportation Economics, Elsevier, vol. 110(C).
    • Handle: RePEc:eee:retrec:v:110:y:2025:i:c:s0739885925000253
    DOI: 10.1016/j.retrec.2025.101542
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0739885925000253
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.retrec.2025.101542?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

    for a different version of it.

    References listed on IDEAS

    as
    1. Hennessy, Hugh & Tol, Richard S.J., 2011. "The impact of tax reform on new car purchases in Ireland," Energy Policy, Elsevier, vol. 39(11), pages 7059-7067.
    2. Cristea, Anca & Hummels, David & Puzzello, Laura & Avetisyan, Misak, 2013. "Trade and the greenhouse gas emissions from international freight transport," Journal of Environmental Economics and Management, Elsevier, vol. 65(1), pages 153-173.
    3. Schwirplies, Claudia & Dütschke, Elisabeth & Schleich, Joachim & Ziegler, Andreas, 2019. "The willingness to offset CO2 emissions from traveling: Findings from discrete choice experiments with different framings," Ecological Economics, Elsevier, vol. 165(C), pages 1-1.
    4. Xiaomei Lin & Yusak O. Susilo & Chunfu Shao & Chengxi Liu, 2018. "The Implication of Road Toll Discount for Mode Choice: Intercity Travel during the Chinese Spring Festival Holiday," Sustainability, MDPI, vol. 10(8), pages 1-16, August.
    5. Johanna Camargo Pérez & Martha Carrillo & Jairo Montoya-Torres, 2015. "Multi-criteria approaches for urban passenger transport systems: a literature review," Annals of Operations Research, Springer, vol. 226(1), pages 69-87, March.
    6. Benedikt Mandel & Marc Gaudry & Werner Rothengatter, 1997. "A disaggregate Box-Cox Logit mode choice model of intercity passenger travel in Germany and its implications for high-speed rail demand forecasts," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 31(2), pages 99-120.
    7. Avetisyan, Misak, 2018. "Impacts of global carbon pricing on international trade, modal choice and emissions from international transport," Energy Economics, Elsevier, vol. 76(C), pages 532-548.
    8. Gambhir, Ajay & Tse, Lawrence K.C. & Tong, Danlu & Martinez-Botas, Ricardo, 2015. "Reducing China’s road transport sector CO2 emissions to 2050: Technologies, costs and decomposition analysis," Applied Energy, Elsevier, vol. 157(C), pages 905-917.
    9. Lucas W. Davis, 2023. "Electric vehicles in multi-vehicle households," Applied Economics Letters, Taylor & Francis Journals, vol. 30(14), pages 1909-1912, August.
    10. Banzhaf, H. Spencer & Kasim, M. Taha, 2019. "Fuel consumption and gasoline prices: The role of assortative matching between households and automobiles," Journal of Environmental Economics and Management, Elsevier, vol. 95(C), pages 1-25.
    11. Hess, Stephane & Spitz, Greg & Bradley, Mark & Coogan, Matt, 2018. "Analysis of mode choice for intercity travel: Application of a hybrid choice model to two distinct US corridors," Transportation Research Part A: Policy and Practice, Elsevier, vol. 116(C), pages 547-567.
    12. Adam Rose & Misak Avetisyan & Heather Rosoff & William J. Burns & Paul Slovic & Oswin Chan, 2017. "The Role of Behavioral Responses in the Total Economic Consequences of Terrorist Attacks on U.S. Air Travel Targets," Risk Analysis, John Wiley & Sons, vol. 37(7), pages 1403-1418, July.
    13. Richard S.J. Tol, 2006. "The Impact Of A Carbon Tax On International Tourism," Working Papers FNU-120, Research unit Sustainability and Global Change, Hamburg University, revised Nov 2006.
    14. Zia Wadud & Muhammad Adeel & Jillian Anable, 2024. "Understanding the large role of long-distance travel in carbon emissions from passenger travel," Nature Energy, Nature, vol. 9(9), pages 1129-1138, September.
    15. Shanjun Li & Christopher Timmins & Roger H. von Haefen, 2009. "How Do Gasoline Prices Affect Fleet Fuel Economy?," American Economic Journal: Economic Policy, American Economic Association, vol. 1(2), pages 113-137, August.
    16. Train, Kenneth & Wilson, Wesley W., 2008. "Estimation on stated-preference experiments constructed from revealed-preference choices," Transportation Research Part B: Methodological, Elsevier, vol. 42(3), pages 191-203, March.
    17. Zheng, Zuduo & Washington, Simon & Hyland, Paul & Sloan, Keith & Liu, Yulin, 2016. "Preference heterogeneity in mode choice based on a nationwide survey with a focus on urban rail," Transportation Research Part A: Policy and Practice, Elsevier, vol. 91(C), pages 178-194.
    18. McFadden, Daniel, 1974. "The measurement of urban travel demand," Journal of Public Economics, Elsevier, vol. 3(4), pages 303-328, November.
    19. Alam, Md. Saniul & Hyde, Bernard & Duffy, Paul & McNabola, Aonghus, 2017. "Assessment of pathways to reduce CO2 emissions from passenger car fleets: Case study in Ireland," Applied Energy, Elsevier, vol. 189(C), pages 283-300.
    20. Wen, Chieh-Hua & Wang, Wei-Chung & Fu, Chiang, 2012. "Latent class nested logit model for analyzing high-speed rail access mode choice," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 48(2), pages 545-554.
    21. Eric Miller & Matthew Roorda & Juan Carrasco, 2005. "A tour-based model of travel mode choice," Transportation, Springer, vol. 32(4), pages 399-422, July.
    22. Guevara, C. Angelo & Hess, Stephane, 2019. "A control-function approach to correct for endogeneity in discrete choice models estimated on SP-off-RP data and contrasts with an earlier FIML approach by Train & Wilson," Transportation Research Part B: Methodological, Elsevier, vol. 123(C), pages 224-239.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. van Cranenburgh, Sander & Garrido-Valenzuela, Francisco, 2025. "Computer vision-enriched discrete choice models, with an application to residential location choice," Transportation Research Part A: Policy and Practice, Elsevier, vol. 192(C).
    2. Irawan, Muhammad Zudhy & Simanjuntak, Nurvita I.M. & Bastarianto, Faza Fawzan & Dwitasari, Reslyana & Herawati,, 2020. "Predicting the impact of Trans Java Toll Roads on demand for intercity air travel in Indonesia," Journal of Air Transport Management, Elsevier, vol. 87(C).
    3. de Grange, Louis & González, Felipe & Marechal, Matthieu & Troncoso, Rodrigo, 2024. "Estimating multinomial logit models with endogenous variables: Control function versus two adapted approaches," Transportation Research Part A: Policy and Practice, Elsevier, vol. 183(C).
    4. Fowri, Hamid R. & Seyedabrishami, Seyedehsan, 2020. "Assessment of urban transportation pricing policies with incorporation of unobserved heterogeneity," Transport Policy, Elsevier, vol. 99(C), pages 12-19.
    5. Sander van Cranenburgh & Francisco Garrido-Valenzuela, 2023. "Computer vision-enriched discrete choice models, with an application to residential location choice," Papers 2308.08276, arXiv.org.
    6. Tao, Xuezong & Zhu, Lichao, 2020. "Meta-analysis of value of time in freight transportation: A comprehensive review based on discrete choice models," Transportation Research Part A: Policy and Practice, Elsevier, vol. 138(C), pages 213-233.
    7. Gabriela Inchauste & Hernan Winkler, 2012. "Decomposing Distributional Changes in Pakistan," World Bank Publications - Reports 17882, The World Bank Group.
    8. Feo-Valero, María & Arencibia, Ana Isabel & Román, Concepción, 2016. "Analyzing discrepancies between willingness to pay and willingness to accept for freight transport attributes," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 89(C), pages 151-164.
    9. Inchauste, Gabriela & Olivieri, Sergio & Saavedra, Jaime & Winkler, Hernan, 2012. "What is behind the decline in poverty since 2000 ? evidence from Bangladesh, Peru and Thailand," Policy Research Working Paper Series 6199, The World Bank.
    10. Ning Huan & Stephane Hess & Toshiyuki Yamamoto & Enjian Yao, 2026. "Modelling intermodal traveller behaviour in mega-city regions: simultaneous versus sequential estimation frameworks," Transportation, Springer, vol. 53(1), pages 35-70, February.
    11. Haghani, Milad & Bliemer, Michiel C.J. & Rose, John M. & Oppewal, Harmen & Lancsar, Emily, 2021. "Hypothetical bias in stated choice experiments: Part II. Conceptualisation of external validity, sources and explanations of bias and effectiveness of mitigation methods," Journal of choice modelling, Elsevier, vol. 41(C).
    12. Greene, David L. & Sims, Charles B. & Muratori, Matteo, 2020. "Two trillion gallons: Fuel savings from fuel economy improvements to US light-duty vehicles, 1975–2018," Energy Policy, Elsevier, vol. 142(C).
    13. Pereda, Paula Carvalho & Lucchesi, Andrea & Oliveira, Thais Diniz & Wolf, Rayan, 2025. "Carbon tax in the shipping sector: Assessing economic and environmental impacts," Energy Policy, Elsevier, vol. 204(C).
    14. Liu, Sihan & Niu, Xinyi & Cao, Zhan & De Vos, Jonas, 2025. "Assessing the impact of urban place irreplaceability on intercity travel mode choice," Journal of Transport Geography, Elsevier, vol. 127(C).
    15. Huang, Yue & Gan, Hongcheng & Postorino, Maria Nadia & Wang, Ke & Wu, Xuelian, 2025. "Young people preferences about enhanced transportation services for intercity trips: An integrated choice and latent variable approach," Research in Transportation Economics, Elsevier, vol. 114(C).
    16. Altieri, Marcelo & Silva, Cecília & Terabe, Shintaro, 2020. "Give public transit a chance: A comparative analysis of competitive travel time in public transit modal share," Journal of Transport Geography, Elsevier, vol. 87(C).
    17. Mizutani, Fumitoshi & Uranishi, Shuji, 2020. "An analysis of the inter-effect of structural reforms and rail mode share," Research in Transportation Economics, Elsevier, vol. 81(C).
    18. Du, Kerui & Yu, Ying & Li, Jing, 2020. "Does international trade promote CO2 emission performance? An empirical analysis based on a partially linear functional-coefficient panel data model," Energy Economics, Elsevier, vol. 92(C).
    19. Zhou, Heng & Qiao, Jiale & Li, Weiwei & Norman, Richard & Yao, Zhigang, 2024. "Understanding college student tourists' travel choices: Economic implications from latent class nested logit modelling," Research in Transportation Economics, Elsevier, vol. 108(C).
    20. Elisheba Spiller & Heather Stephens & Christopher Timmins & Allison Smith, 2014. "The Effect of Gasoline Taxes and Public Transit Investments on Driving Patterns," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 59(4), pages 633-657, December.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

    Statistics

    Access and download statistics

    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:retrec:v:110:y:2025:i:c:s0739885925000253. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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/wps/find/journaldescription.cws_home/620614/description#description .

    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.