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| Parry, Ian W.H.; Small, Kenneth A.. |
| This paper develops an analytical framework for assessing the second-best optimal level of gasoline taxation taking into account unpriced pollution, congestion, and accident externalities, and interactions with the broader fiscal system. We provide calculations of the optimal taxes for the US and the UK under a wide variety of parameter scenarios, with the gasoline tax substituting for a distorting tax on labor income. Under our central parameter values, the second-best optimal gasoline tax is $1.01/gal for the US and $1.34/gal for the UK. These values are moderately sensitive to alternative parameter assumptions. The congestion externality is the largest component in both nations, and the higher optimal tax for the UK is due mainly to a higher assumed... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Gasoline tax; Pollution; Congestion; Accidents; Fiscal interactions; Public Economics; H21; H23; R48. |
| Ano: 2004 |
URL: http://purl.umn.edu/10461 |
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| Parry, Ian W.H.; Bento, Antonio M.. |
| This paper uses analytical and numerical models to illustrate how the presence of other distortions within the transport system changes the overall welfare effect of a congestion tax. These other distortions include a transit fare subsidy, congestion on competing (unpriced) routes, accident externalities, gasoline taxes, and pollution externalities. Each of these pre-existing distortions can substantially alter the welfare effect of a congestion tax that would be predicted by a first-best analysis. If congestion taxes encourage travel on other congested routes, they can produce sizeable indirect welfare losses. In addition, induced reductions in the demand for gasoline can lead to substantial welfare losses when, as appears to be the case for European... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Congestion tax; Welfare effect; Transit subsidy; Gasoline tax; Accidents; Pollution; Public Economics; R41; H21; H23. |
| Ano: 2000 |
URL: http://purl.umn.edu/10678 |
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| Parry, Ian W.H.. |
| Gasoline taxes are widely perceived as the most efficient instrument for reducing gasoline consumption because they exploit all behavioral responses for reducing fuel use, including reduced driving and improved fuel economy. At present, however, higher fuel taxes are viewed as a political nonstarter. Pay-as-you-drive (PAYD) auto insurance, which involves replacing existing lump-sum premiums with premiums that vary in proportion to miles driven, should be more practical, since they do not raise driving costs for the average motorist. We show that when impacts on a broad range of motor vehicle externalities are considered, PAYD also induces significantly higher welfare gains than comparable gasoline tax increases, for fuel reductions below 9%. The reason is... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Gasoline tax; Pay-as-you-drive insurance; Mileage tax; Welfare effects; Motor vehicle externality; Risk and Uncertainty; H21; H23; R48. |
| Ano: 2005 |
URL: http://purl.umn.edu/10465 |
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| Parry, Ian W.H.; Fischer, Carolyn; Harrington, Winston. |
| This paper develops analytical models to estimate the welfare effects of higher Corporate Average Fuel Economy (CAFE) standards on new passenger vehicles. The analysis incorporates a broad range of fuel-and-driving-related externalities, fuel taxes, different assumptions concerning consumers' valuation of fuel saving technologies and their alternative value in enhancing other vehicle attributes, and endogenous vehicle fleet composition. To implement the analysis, we develop estimates of CAFE's impact on local pollution, nationwide congestion, and traffic accidents. We find that higher fuel economy standards can produce anything from moderate welfare gains, to very little or no effect, to substantial welfare losses, depending on how consumers value fuel... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Fuel economy standards; Oil dependency; Carbon emissions; Rebound effect; Gasoline tax; Resource /Energy Economics and Policy; R48; Q48; H23. |
| Ano: 2004 |
URL: http://purl.umn.edu/10605 |
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| Parry, Ian W.H.. |
| This paper discusses the appropriate balance between traditional gasoline taxes and charging by the mile, focusing mainly on economic efficiency considerations. We begin with a brief discussion of the five major passenger vehicle externalities of concern-local pollution, greenhouse warming, oil dependency, traffic congestion, and traffic accidents-summarizing evidence on the dollar value of the externalities for passenger vehicles in the United States. We then discuss how much fuel taxation might be justified to account for these externalities, as well as how much taxation might be appropriate on fiscal grounds, assuming per-mile charges are unavailable. Finally, we discuss to what extent fuel taxation should be replaced with per-mile charges. |
| Tipo: Working or Discussion Paper |
Palavras-chave: Gasoline tax; Mileage tax; Motor vehicle externalities; Fiscal interactions; Public Economics; H21; H23; R48. |
| Ano: 2005 |
URL: http://purl.umn.edu/10805 |
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