Discussion Paper

Do Market Shares or Technology Explain Rising New Vehicle Fuel Economy?

Sep 9, 2013 | Shefali Khanna, Joshua Linn


By decreasing gasoline consumption, greater fuel economy could significantly reduce environmental and energy security concerns. In this paper, we show that since the year 2000, technology and market shares have contributed roughly equally to rising new vehicle fuel economy in the United States. We discuss the implications of these patterns for the safety and welfare effects of fuel economy standards.