IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Unintended Consequences from Nested State & Federal Regulations: The Case of the Pavley Greenhouse-Gas-per-Mile Limits

  • Lawrence Goulder

    ()

    (Stanford Environmental and Energy Policy Analysis Center, Stanford University)

  • Mark Jacobsen

    (University of California San Diego)

  • Arthur van Benthem

    ()

    (Department of Economics, Stanford University)

Registered author(s):

    Fourteen U.S. states recently pledged to adopt limits on greenhouse gases (GHGs) per mile of light-duty automobiles. Previous analyses predicted that these limits will yield significant reductions in GHGs. However, these studies did not consider critical factors that imply different results. This paper develops a multi-period numerical simulation model that accounts for these factors in assessing the impact of the proposed GHG-per-mile standards on U.S. gasoline consumption and GHG emissions. We find that while the state-level initiative would reduce significantly the emissions associated with new cars in the adopting states, it would give rise to very significant offsetting increases (“leakage”) elsewhere, in both new and used car markets. Because of interactions with the federal CAFE standard, technology spillovers mitigate leakage only slightly. In the most plausible scenarios considered, the leakage is around 70 percent. Correspondingly, the cost per gallon saved under the GHG-per-mile limits is about 72 percent higher than for an equivalent increase in the federal CAFE standard.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://www-siepr.stanford.edu/repec/sip/08-049.pdf
    Download Restriction: no

    Paper provided by Stanford Institute for Economic Policy Research in its series Discussion Papers with number 08-049.

    as
    in new window

    Length:
    Date of creation: Aug 2009
    Date of revision:
    Handle: RePEc:sip:dpaper:08-049
    Contact details of provider: Postal: 366 Galvez Street, Stanford, California 94305-6015
    Phone: (650) 725-1874
    Fax: (650) 723-8611
    Web page: http://siepr.stanford.edu
    More information through EDIRC

    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.:

    as in new window
    1. Kenneth A. Small & Kurt Van Dender, 2007. "Fuel Efficiency and Motor Vehicle Travel: The Declining Rebound Effect," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 25-52.
    2. Barker, Terry & Junankar, Sudhir & Pollitt, Hector & Summerton, Philip, 2007. "Carbon leakage from unilateral Environmental Tax Reforms in Europe, 1995-2005," Energy Policy, Elsevier, vol. 35(12), pages 6281-6292, December.
    3. Soren T. Anderson & James M. Sallee, 2009. "Using Loopholes to Reveal the Marginal Cost of Regulation: The Case of Fuel-Economy Standards," Working Papers 0901, Harris School of Public Policy Studies, University of Chicago.
    4. James Bushnell & Carla Peterman & Catherine Wolfram, 2008. "Local Solutions to Global Problems: Climate Change Policies and Regulatory Jurisdiction," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 2(2), pages 175-193, Summer.
    5. Lucas W. Davis & Matthew E. Kahn, 2010. "International Trade in Used Vehicles: The Environmental Consequences of NAFTA," American Economic Journal: Economic Policy, American Economic Association, vol. 2(4), pages 58-82, November.
    6. Christopher R. Knittel, 2011. "Automobiles on Steroids: Product Attribute Trade-Offs and Technological Progress in the Automobile Sector," American Economic Review, American Economic Association, vol. 101(7), pages 3368-99, December.
    7. Felder Stefan & Rutherford Thomas F., 1993. "Unilateral CO2 Reductions and Carbon Leakage: The Consequences of International Trade in Oil and Basic Materials," Journal of Environmental Economics and Management, Elsevier, vol. 25(2), pages 162-176, September.
    8. Harrington, Winston & McConnell, Virginia & Alberini, Anna, 1998. "Fleet Turnover and Old Car Scrap Policies," Discussion Papers dp-98-23, Resources For the Future.
    9. Robert W. Hahn, 1995. "An Economic Analysis of Scrappage," RAND Journal of Economics, The RAND Corporation, vol. 26(2), pages 222-242, Summer.
    10. Bento, Antonio M. & Goulder, Lawrence H. & Jacobsen, Mark R. & von Haefen, Roger H., 2007. "Distributional and Efficiency Impacts of Increased U.S. Gasoline Taxes," Working Papers 127021, Cornell University, Department of Applied Economics and Management.
    11. Thomas H. Klier & Joshua Linn, 2008. "New vehicle characteristics and the cost of the corporate average fuel economy standard," Working Paper Series WP-08-13, Federal Reserve Bank of Chicago.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:sip:dpaper:08-049. 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: (Anne Shor)

    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 references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.