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How Regulations Can Succeed Where Taxes Do Not: An Examination of Automobile Fuel Efficiency

Author

Listed:
  • Amihai Glazer

    (University of California, Irvine)

  • Charles Lave
Abstract
In 1975 the United States government required automobile manufacturers to increase the corporate average fuel economy of their products. Why were such CAFE regulations more effective than increases in the price of gasoline in improving fuel economy? Our answer focuses on myopia by consumers, myopia by producers, and the rational incentive to delay irreversible investments.

Suggested Citation

  • Amihai Glazer & Charles Lave, 1994. "How Regulations Can Succeed Where Taxes Do Not: An Examination of Automobile Fuel Efficiency," Public Economics 9406002, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwppe:9406002
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    References listed on IDEAS

    as
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    Cited by:

    1. Sofronis Clerides & Theodoros Zachariadis, 2006. "Are standards Effective in Improving Automobile Fuel Economy?," University of Cyprus Working Papers in Economics 6-2006, University of Cyprus Department of Economics.

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    More about this item

    JEL classification:

    • D6 - Microeconomics - - Welfare Economics
    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • H - Public Economics

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