| Title |
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Car user taxes, quality characteristics, and fuel efficiency
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| Author |
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| Abstract |
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| We study the impact of car user taxes on vehicle quality and demand for kilometres. First, holding car prices fixed, we find that a higher fuel tax leads households to choose cars of better fuel efficiency, provided that the demand for car use is inelastic. Surprisingly, a higher kilometre tax reduces the demand for fuel efficiency. Next, we study how car prices react to the tax changes. Fuel taxes make owning very fuel-efficient cars more expensive, while reducing prices of cars of low fuel efficiency. Both fuel taxes and kilometre charges imply lower prices for large and powerful cars. | | |
| Language |
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English
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| Source (journal) |
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Journal of transport economics and policy. - London, 1967, currens | |
| Publication |
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London : 2014
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| ISSN |
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0022-5258 [print]
1754-5951 [online]
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| Volume/pages |
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48:3(2014), p. 345-366
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| ISI |
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000340698000001
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