We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
How Much Do Consumers Value Fuel Economy and Performance? Evidence from Technology Adoption.
- Authors
Leard, Benjamin; Linn, Joshua; Zhou, Yichen Christy
- Abstract
During historical periods in which U.S. fuel economy standards were unchanging, automakers increased performance but not fuel economy, contrasting with recent periods of tightening standards and rising fuel economy. This paper evaluates the welfare consequences of automakers forgoing performance increases to raise fuel economy as standards have tightened since 2012. Using a unique data set and a novel approach to account for fuel economy and performance endogeneity, we find undervaluation of fuel cost savings and high valuation of performance. Welfare costs of forgone performance approximately equal expected fuel savings benefits, suggesting approximately zero net private consumer benefit from tightened standards.
- Subjects
AUTOMOTIVE fuel consumption standards; INNOVATION adoption; CONSUMERS; UNITED States economy; FUEL costs; MOSQUITO nets; TRUCK fuel consumption
- Publication
Review of Economics & Statistics, 2023, Vol 105, Issue 1, p158
- ISSN
0034-6535
- Publication type
Article
- DOI
10.1162/rest_a_01045