The Economic Implications of the Corporate Average Fuel Economy Regulations
Presentation Type
Oral and/or Visual Presentation
Presenter Major(s)
Natural Resource Management
Mentor Information
C. "Griff" Griffin
Department
Biology
Location
Kirkhof Center 1142
Start Date
11-4-2012 10:30 AM
Keywords
Environment
Abstract
Since 1975 the Corporate Average Fuel Economy regulations (CAFE) have governed fuel efficiency in the United States. Introduced to conserve fuel after the 1973 oil embargo, the CAFE regulations have always been controversial. CAFE aims to control fuel consumption through indirect and inefficient methods. The aging regulations were built around popular vehicle models of the 1970's (such as the Station Wagon), but do not properly regulate today's models (i.e., SUVs and Minivans). Beyond inefficiencies there is the Rebound Effect, where a commodity will be used more the less it costs, which applies to gasoline with highly-rated mile per gallon (MPH) vehicles. A direct control (such as a tax) would be a more efficient limit on fuel consumption. Consumers and producers respond to incentives, incentives not present with current CAFE regulations.
The Economic Implications of the Corporate Average Fuel Economy Regulations
Kirkhof Center 1142
Since 1975 the Corporate Average Fuel Economy regulations (CAFE) have governed fuel efficiency in the United States. Introduced to conserve fuel after the 1973 oil embargo, the CAFE regulations have always been controversial. CAFE aims to control fuel consumption through indirect and inefficient methods. The aging regulations were built around popular vehicle models of the 1970's (such as the Station Wagon), but do not properly regulate today's models (i.e., SUVs and Minivans). Beyond inefficiencies there is the Rebound Effect, where a commodity will be used more the less it costs, which applies to gasoline with highly-rated mile per gallon (MPH) vehicles. A direct control (such as a tax) would be a more efficient limit on fuel consumption. Consumers and producers respond to incentives, incentives not present with current CAFE regulations.