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A regression on climate policy: The European Commission’s legislation to reduce CO2 emissions from automobiles

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  • Frondel, Manuel
  • Schmidt, Christoph M.
  • Vance, Colin

Abstract

As part of its efforts to reach the targets of the Kyoto Protocol, in April 2009 the European Commission enacted new legislation to reduce the per-kilometer CO2 emissions of newly registered automobiles. This paper critically assesses this legislation with respect to its economic and technological underpinnings. First, we argue that the reliance on targets based on per-kilometer emissions not only conceals the true cost of compliance and thereby stifles informed public discourse, but is also less cost-effective than alternative measures such as emissions trading. Second, the emission targets stipulated in this legislation are based on linear-regression methods that we demonstrate to be poorly justified and misleading. Using instead stochastic-frontier analysis, which is argued to more accurately reflect the industry’s technological status quo, alternative targets are consequently proposed.

Suggested Citation

  • Frondel, Manuel & Schmidt, Christoph M. & Vance, Colin, 2011. "A regression on climate policy: The European Commission’s legislation to reduce CO2 emissions from automobiles," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(10), pages 1043-1051.
  • Handle: RePEc:eee:transa:v:45:y:2011:i:10:p:1043-1051
    DOI: 10.1016/j.tra.2009.12.001
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    References listed on IDEAS

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    1. Sterner, Thomas, 2007. "Fuel taxes: An important instrument for climate policy," Energy Policy, Elsevier, vol. 35(6), pages 3194-3202, June.
    2. Manuel Frondel & Christoph M. Schmidt, 2006. "The Empirical Assessment of Technology Differences: Comparing the Comparable," The Review of Economics and Statistics, MIT Press, vol. 88(1), pages 186-192, February.
    3. Manuel Frondel & Jorg Peters & Colin Vance, 2008. "Identifying the Rebound: Evidence from a German Household Panel," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 145-164.
    4. Manuel Frondel & Colin Vance, 2009. "Do High Oil Prices Matter? Evidence on the Mobility Behavior of German Households," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 43(1), pages 81-94, May.
    5. Kumbhakar,Subal C. & Lovell,C. A. Knox, 2003. "Stochastic Frontier Analysis," Cambridge Books, Cambridge University Press, number 9780521666633, April.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Frondel, Manuel & Ritter, Nolan & Vance, Colin, 2012. "Heterogeneity in the rebound effect: Further evidence for Germany," Energy Economics, Elsevier, vol. 34(2), pages 461-467.
    2. Frondel, Manuel & Vance, Colin, 2013. "Re-Identifying the Rebound: What About Asymmetry?," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 42-54.
    3. repec:zbw:rwipos:062 is not listed on IDEAS
    4. Vance, Colin & Frondel, Manuel, 2015. "From fuel taxation to efficiency standards: A wrong turn in European climate protection?," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113171, Verein für Socialpolitik / German Economic Association.
    5. repec:eee:transa:v:106:y:2017:i:c:p:22-50 is not listed on IDEAS
    6. Frondel, Manuel & Schmidt, Christoph M. & aus dem Moore, Nils, 2012. "Marktwirtschaftliche Energiewende: Ein Wettbewerbsrahmen für die Stromversorgung mit alternativen Technologien. Ein Projekt im Auftrag der Initiative Neue Soziale Marktwirtschaft," RWI Projektberichte, RWI - Leibniz-Institut für Wirtschaftsforschung, number 69954.
    7. Manuel Frondel, 2014. "Teuer und ineffizient: Die Emissionsminderung der EU," RWI Positionen, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, pages 17, December.
    8. Mabit, Stefan L., 2014. "Vehicle type choice under the influence of a tax reform and rising fuel prices," Transportation Research Part A: Policy and Practice, Elsevier, vol. 64(C), pages 32-42.
    9. Frondel, Manuel, 2014. "Teuer und ineffizient: Die Emissionsminderung der EU," RWI Positionen 62, RWI - Leibniz-Institut für Wirtschaftsforschung.
    10. Manuel Frondel & Colin Vance, 2013. "Fuel Taxes versus Efficiency Standards – An Instrumental Variable Approach," Ruhr Economic Papers 0445, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    11. Montag, Josef, 2015. "The simple economics of motor vehicle pollution: A case for fuel tax," Energy Policy, Elsevier, vol. 85(C), pages 138-149.
    12. Frondel, Manuel & Vance, Colin, 2013. "Fuel Taxes versus Efficiency Standards – An Instrumental Variable Approach," Ruhr Economic Papers 445, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    13. repec:zbw:rwirep:0445 is not listed on IDEAS

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