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  Policy-simulations 08/03/2019 12:42:AM
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Project Citation: 

Project Description

Summary:  View help for Summary We examine the impacts of increased US gasoline taxes in a model that links the markets for new, used, and scrapped vehicles and recognizes the considerable heterogeneity among households and cars. Household choice parameters derive from an estimation procedure that integrates individual choices for car ownership and miles traveled. We find that each cent-per-gallon increase in the price of gasoline reduces the equilibrium gasoline consumption by about 0.2 percent. Taking account of revenue recycling, the impact of a 25-cent gasoline tax increase on the average household is about $30 per year (2001 dollars). Distributional impacts depend importantly on how additional revenues from the tax increase are recycled. (JEL D12, H22, H25, L62, L71)

Scope of Project

JEL Classification:  View help for JEL Classification
      D12 Consumer Economics: Empirical Analysis
      H25 Business Taxes and Subsidies
      L71 Mining, Extraction, and Refining: Hydrocarbon Fuels
      H22 Incidence
      L62 Automobiles • Other Transportation Equipment • Related Parts and Equipment


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