Title: On the incentives to provide fuel-efficient automobiles
Authors: Degryse, Hans ×
Irmen, A #
Issue Date: 2001
Series Title: Journal of economics vol:73 issue:2 pages:149-165
Abstract: We argue that the provision of more fuel-efficient cars necessitates specific aerodynamic shapes. We show that the presence of this technological constraint may reduce the incentives to provide fuel efficiency. In equilibrium, cars become more similar and aerodynamic as fuel prices increase. However, the provided level of fuel efficiency falls short of the social optimal one such that a fuel-economy standard is welfare-enhancing.
ISSN: 0931-8658
Publication status: published
KU Leuven publication type: IT
Appears in Collections:Research Center of Monetary and Information Economics, Leuven
× corresponding author
# (joint) last author

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