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How Do Fuel Taxes Impact New Car Purchases? an Evaluation Using French Consumer-Level Data

Aufsätze referiert extern - Web of Science

Pauline Givord, Céline Grislain-Letrémy, Helene Naegele

In: Energy Economics 74 (2018), S. 76-96


This study evaluates the impact of fuel taxes on new car purchases, using exhaustive individual-level data of monthly new car registrations in France. We use information on the car holder to account for heterogeneous preferences across purchasers, and we identify demand parameters through the large oil price fluctuations of this period. We find that the short-term sensitivity of demand with respect to fuel prices is low, particularly for corporate purchases. Using our estimates to compute elasticities, we assess the impact of a policy equalizing diesel and gasoline taxes. Such a policy reduces the share of diesel-engines without substantially changing the average fuel consumption or CO2 intensity of new cars. Alternatively, we find that a (revenue-equivalent) carbon tax has only small effects on average fuel consumption and CO2 intensity of new cars.

JEL-Classification: C25;D12;H23;L62;Q53
Keywords: Fuel prices, Automobile demand, Carbon dioxide emissions, Environmental tax
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