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- Title
The benefits and costs of ethanol: an evaluation of the government’s analysis.
- Authors
Hahn, Robert; Cecot, Caroline
- Abstract
Ethanol production in the United States has been steadily growing and is expected to continue growing. Many politicians see increased ethanol use as a way to promote environmental goals, such as reducing greenhouse gas emissions, and energy security goals. This paper provides a benefit-cost analysis of increasing ethanol use based on an analysis by the Environmental Protection Agency. We find that the cost of increasing ethanol production to almost ten billion gallons a year is likely to exceed the benefits by about three billion dollars annually. We also suggest that earlier attempts aimed at promoting ethanol would have likely failed a benefit-cost test, and that Congress should consider repealing ethanol incentive programs, such as the ethanol tariff and tax credit.
- Subjects
UNITED States; COST effectiveness; GREENHOUSE gas mitigation; ENERGY conservation; ENERGY tax credits; COST control; ETHANOL as fuel; SUBSIDIES; ENERGY policy; UNITED States. Congress; UNITED States. Environmental Protection Agency
- Publication
Journal of Regulatory Economics, 2009, Vol 35, Issue 3, p275
- ISSN
0922-680X
- Publication type
Article
- DOI
10.1007/s11149-008-9080-1