Another Look at U.S. Passenger Vehicle Use and the ‘Rebound’ Effect from Improved Fuel Efficiency*

Clifton T. Jones

The Energy Journal, 1993, vol. 14, issue 4, 99-110

Abstract: Recently, Greene (1992) analyzed vehicle miles travelled for U.S. passenger vehicles over 1966-89 to econometrically estimate the “rebound†effect in fuel consumption resulting from improved fuel efficiency. He found that a static AR(1) model could not be rejected, implying that the rebound effect is small (13 %) with no significant long-run adjustments, regardless of the assumed functional form (linear or loglinear). Another look at the data from a different model selection approach shows that while a loglinear AR(1) model is acceptable, the linear version is not. Using either form, a lagged dependent variable model cannot be rejected on statistical grounds yet has insignificant GNP effects, yielding similarly small short-run rebound effects but significant long-run rebound effects of about 30%. Thus, the evidence from these competing models for a significant long-run adjustment process is mixed, so that its presence cannot be completely ruled out.

Keywords: CAFÉ; Passenger vehicles; Rebound effect; US (search for similar items in EconPapers)
Date: 1993
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Persistent link: https://EconPapers.repec.org/RePEc:sae:enejou:v:14:y:1993:i:4:p:99-110

DOI: 10.5547/ISSN0195-6574-EJ-Vol14-No4-6

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