Timing Matters: Estimating within-day variation in the rebound effect

Cody Nehiba

No 348907, National Center for Environmental Economics-NCEE Working Papers from United States Environmental Protection Agency (EPA)

Abstract: Travel demand and congestion fluctuate throughout the day, but temporal heterogeneity in travel demand elasticities is often overlooked. I estimate within-day variation in the fuel economy elasticity of travel demand, illustrating the timing of the rebound effect — when higher fuel efficiency standards increase mileage by decreasing per-mile costs. I find that drivers are most elastic during peak demand periods that coincide with morning and evening commuting hours. Mode switching for shorter commute trips in areas with low-cost alternatives appears to drive much of the within-day heterogeneity. Further, accounting for temporal heterogeneity in the rebound effect has the potential to determine whether the congestion costs of a fuel economy improvement exceed the pollution benefits.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 62
Date: 2025-01
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Persistent link: https://EconPapers.repec.org/RePEc:ags:nceewp:348907

DOI: 10.22004/ag.econ.348907

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