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Re-Identifying the Rebound: What About Asymmetry?

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  • Manuel Frondel
  • Colin Vance

Abstract

Rebound effects measure the behaviorally induced offset in the reduction of energy consumption following efficiency improvements. Using panel estimation methods and household travel diary data collected in Germany between 1997 and 2009, this study identifies the rebound effect in private transport by allowing for the possibility that fuel price elasticities—from which rebound effects can be derived—are asymmetric. This approach rests on empirical evidence suggesting that the response in individual travel demand to price increases is stronger than to decreases. We argue that such an asymmetric response would require referencing price elasticities derived from price decreases in order to identify the rebound effect, as it represents the response to a decrease in unit cost for car travel due to improved fuel efficiency. Failing to reject the null hypothesis of a symmetric price response, we alternatively estimate a reversible specification and obtain a rebound estimate for single-vehicle households being in the range of 46 to 70%, which is in line with an earlier German study by Frondel, Peters, and Vance (2008).

Suggested Citation

  • Manuel Frondel & Colin Vance, 2013. "Re-Identifying the Rebound: What About Asymmetry?," The Energy Journal, , vol. 34(4), pages 43-54, October.
    • Handle: RePEc:sae:enejou:v:34:y:2013:i:4:p:43-54
    DOI: 10.5547/01956574.34.4.3
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    References listed on IDEAS

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    8. Manuel Frondel & Colin Vance, 2010. "Fixed, Random, or Something in Between? – A Variant of HAUSMAN’s Specifi cation Test for Panel Data Estimators," Ruhr Economic Papers 0160, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
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    1. Frondel, Manuel, 2024. "Die hohen unbekannten CO₂-Vermeidungskosten ordnungsrechtlicher Klimaschutzmaßnahmen: Empirische Beispiele aus Deutschland und Europa," RWI Materialien 168, RWI - Leibniz-Institut für Wirtschaftsforschung.
    2. Javier D. Donna, 2021. "Measuring long‐run gasoline price elasticities in urban travel demand," RAND Journal of Economics, RAND Corporation, vol. 52(4), pages 945-994, December.
    3. Fidel Gonzalez & Diya Mazumder, 2025. "Do Declining Vehicle Attributes Eliminate the Direct Rebound Effect?," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 51(2), pages 198-224, April.
    4. Alpizar, Francisco & Carlsson, Fredrik & Lanza, Gracia, 2024. "On the perils of environmentally friendly alternatives," Journal of Environmental Economics and Management, Elsevier, vol. 125(C).

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