eprintid: 25671 rev_number: 10 eprint_status: archive userid: 1482 importid: 105 dir: disk0/00/02/56/71 datestamp: 2018-04-16 13:59:27 lastmod: 2021-04-02 15:57:23 status_changed: 2018-07-23 13:29:07 type: monograph metadata_visibility: no_search creators_name: Grigolon, Laura creators_name: Reynaert, Mathias creators_name: Verboven, Frank creators_idrefppn: 191651133 title: Consumer Valuation of Fuel Costs and the Effectiveness of Tax Policy - Evidence from the European Car Market ispublished: pub subjects: subjects_ECO abstract: To what extent do car buyers undervalue future fuel costs, and what does this imply for the effectiveness and welfare impact of alternative tax policies' To address both questions, we show it is crucial to account for consumer heterogeneity in mileage and other dimensions. We use detailed product-level data for a long panel of European countries, and exploit variation in fuel costs by engine type. Although we find there is modest undervaluation of fuel costs, fuel taxes are still more effective in reducing fuel usage than product taxes based on fuel economy. Importantly, fuel taxes also perform better in terms of total welfare even when usage demand is held completely fixed. The reason is that fuel taxes better target the right consumers, those with a high mileage, to purchase more fuel efficient cars. date: 2017-08 date_type: published publisher: TSE Working Paper official_url: http://tse-fr.eu/pub/31958 faculty: tse divisions: tse language: en has_fulltext: TRUE view_date_year: 2017 full_text_status: public monograph_type: working_paper series: TSE Working Paper volume: 17-836 place_of_pub: Toulouse pages: 67 institution: Université Toulouse 1 Capitole department: Toulouse School of economics book_title: TSE Working Paper oai_identifier: oai:tse-fr.eu:31958 harvester_local_overwrite: department harvester_local_overwrite: faculty harvester_local_overwrite: institution harvester_local_overwrite: place_of_pub harvester_local_overwrite: pages harvester_local_overwrite: creators_idrefppn oai_lastmod: 2018-06-19T13:46:21Z oai_set: tse site: ut1 citation: Grigolon, Laura, Reynaert, Mathias and Verboven, Frank (2017) Consumer Valuation of Fuel Costs and the Effectiveness of Tax Policy - Evidence from the European Car Market. TSE Working Paper, n. 17-836, Toulouse document_url: https://publications.ut-capitole.fr/id/eprint/25671/1/wp_tse_836.pdf