ALCOHOL PREVALENCE,ALCOHOL POLICIES,AND CHILD FATAL INJURY RATES FROM MOTOR VEHICLE CRASHES

In this study, we consider the effects of state alcohol policies on motor vehicle fatalities for children. While numerous studies have considered the effects of such policies on motor vehicle fatalities for the overall population, for teens, and for the elderly, their effects on fatalities among children in particular have not previously been studied. We use state‐level cross‐sectional time series data for 1982–2002. The dependent variable of interest is fatalities among child motor vehicle occupants (CMVO). Separate models are estimated for 0‐ to 4‐yr‐olds, 5‐ to 9‐yr‐olds, and 10‐ to 15‐yr‐olds, as well as for fatalities occurring during the day versus the night. We find that number of fatalities among CMVO is strongly correlated to alcohol use measured at the state level and that administrative license revocation policies and higher beer tax rates appear to consistently reduce such fatalities. For two of the three age groups, beer tax rates appear to reduce fatalities during the night rather than the day. However, zero tolerance and blood alcohol concentration limit laws do not seem to have any statistically significant effects on fatalities. (JEL I18, J13)     

The effectiveness of gasoline taxation to manage air pollution

Higher gasoline taxes can be justified because cars cause significant local, regional, and global air pollution damages. This study examines whether charging higher taxes would result in significant emission reductions. Both experimental survey data and actual behavior in Southern California and Connecticut are evaluated to explore whether people would change their driving behavior in response to higher gasoline prices. Both sets of results reveal that drivers are price inelastic in the short run (−0.4 to −0.6) and long run (−0.5 to −0.7). Imposing environmental surcharges on gasoline will result in only a small reduction in driving and thus only a small improvement in the environment. Such taxes will place a heavy and clear burden on drivers, however, making gasoline taxes extremely unpopular. Finally, the study finds that the income elasticity of gasoline is low (0.1–0.2) so that the gas tax will fall heavily on the poor.     

BINGE DRINKING IN COLLEGE: THE IMPACT OF PRICE, AVAILABILITY, AND ALCOHOL CONTROL POLICIES

This paper estimates the effects of beer prices, alcohol availability, and policies related to driving under the influence of alcohol on drinking and binge drinking among youths and young adults. Data are from a nationally representative survey of students in U.S. colleges and universities. Separate estimates are obtained for underage male and female students, as well as for older male and female students. The estimates indicate that the drinking practices of male college students are generally insensitive to the price of beer. However, underage drinking and binge drinking by female students do respond significantly to price, although both are relatively inelastic. The results also show that strong drunk driving policies targeting youths and young adults significantly reduce drinking and binge drinking by male students. Similarly, these policies reduce drinking among female college students but appear to have little impact on their binge drinking. Instead, the results indicate that many elements of campus life (including participation in a fraternity or sorority, living on campus, and the ready availability of alcoholic beverages) are among the most important determinants of drinking and binge drinking among college students.     

THE IMPACT OF LARGE CONTAINER BEER PURCHASES ON ALCOHOL‐RELATED FATAL VEHICLE ACCIDENTS

Using a fixed effect weighted least square model, we examine how changes in the share of beer purchases from large containers (>12 oz.) impact alcohol‐related fatal accidents. We find that, after holding beer purchases and overall alcohol‐consumption constant, an increase in total beer purchases from containers greater than the standard size of 12 oz. increases alcohol‐related fatal accidents. We confirm our results persist across several investigations of robustness, as well as the use of instrument variables methods. Outcomes suggest that policy makers should consider differential excise taxes for the purchase of larger than standard size beer containers. Such a policy would likely reduce the number of alcohol‐related fatal vehicle crashes and help to internalize the negative externalities associated with drunk driving. At the very minimum, these results suggest that individuals prone to dangerous levels of drunk driving are the consumers that most prefer large container size consumption. This is consistent with the idea that binge drinkers and beer drinkers are much more likely to drive while legally intoxicated. (JEL I18, K4)     

Finland's monetary autonomy

A time-series analysis of Japanese data for the period 1966–85 estimates the effectiveness of seat belt and government safety policies on various types of traffic-related fatalities. The results indicate that these policies reduce the risk of death for both motor vehicle occupants and non-occupants.     

Asymmetric search and prospect theory: choice experiment on consumer willingness to search in the gasoline retail market

We use an internet survey conducted among a representative random sample of drivers in the State of Ohio consisting of a choice experiment designed to examine the mechanism driving asymmetric search. The internet survey affords us the opportunity to overcome endogeneity difficulties by imposing exogenous price changes on gasoline consumers to examine the decision-making process behind intended search decisions. We randomly assigned participants to one of five price treatments (either 2.5 or 5% above or below their reported expected price, or no change). We provide a simple empirical model to derive testable implications under prospect theory and use the internet survey to test them. Results indicate that among the respondents who faced prices below their expected price, only 12% chose to search, whereas 45% searched when prices were above. Further, we find results consistent with asymmetric search being driven by prospect theory. The change in consumers’ willingness to search is twice as large when prices exceed expectations by 2.5% relative to when prices exceed them by 5% suggesting that consumers derive utility of finding a good deal evaluated relative to a reference price. We show that this result is inconsistent with standard utility theory or consumers using alternative reference prices.     

A QUANTITATIVE ANALYSIS OF SUBURBANIZATION AND THE DIFFUSION OF THE AUTOMOBILE*

Suburbanization in the United States between 1910 and 1970 was concurrent with the diffusion of the automobile. A circular city model is developed in order to access quantitatively the contribution of automobiles and rising incomes to suburbanization. The model incorporates a number of driving forces of suburbanization and car adoption, including falling automobile prices, rising real incomes, changing costs of traveling by car and with public transportation, and urban population growth. According to the model, 60% of postwar (1940–1970) suburbanization can be explained by these factors. Rising real incomes and falling automobile prices are shown to be the key drivers of suburbanization.     

Reform State Taxes to Increase Productivity

A larger and more productive economy would facilitate the reduction of COVID-19 government deficits and their future repayment. Reform of state taxes is among the low-hanging fruit to include in a broad supply-side agenda to increase national productivity. Approximate aggregate revenue neutral reform packages to reduce tax distortions and improve productivity are discussed for state taxes on property, payroll and motor vehicles.     

Measuring the social value of local public goods: an empirical analysis within Paris metropolitan area

A non-linear hedonic model is used to estimate the implicit marginal prices of 17 local public goods in a Paris suburban area on an original data set of some 8200 housing units. The results reveal a robust effect of local public school quality (measured both by the fraction of junior high school students that are at least two years behind grade level and the student/teacher ratio) on house prices. It is observed that housing owners’ marginal willingness to pay for reducing commuting time is roughly similar for public transportation than for car transportation. Another noticeable result is the complete capitalization of local taxes at a discount rate of 3.5%. An illustration of the potential usefulness of the results for Cost–Benefit analysis is also provided.     

Modelling the demand for housing over the life cycle

We model individual demand for housing over the life cycle, and show the aggregate implications of this behaviour. Individuals delay purchasing their first home when incomes are low or uncertain. Higher house prices lead households to downsize, rather than to stop being owners. Fixed costs (property transactions taxes) have important impacts on welfare (a wealth effect) and house purchase decisions (substitution effect). In aggregate, positive house price shocks lead to consumption booms among the old but falls in consumption for the young, and reduced housing demand; positive income shocks lead to consumption booms among the young and increased housing demand.     

The Effect of Gasoline Taxes and Public Transit Investments on Driving Patterns

This paper analyzes how driving patterns are affected by gasoline taxes and the availability of a substitute for driving—public transportation. We develop a measure of transportation substitutability based on the difference between individuals’ predicted commute times by private and public transit, conditional upon their demographic characteristics and geographic location. Improved substitutability decreases annual vehicle miles traveled (VMT) by inducing modal shifts to public transit, though gasoline taxes are found to have a much larger impact on VMT. Our results imply that a policy that raises gasoline taxes and recycles the revenues into public transit improvements can have even larger impacts on driving patterns than either policy alone.     

Time inconsistency and alcohol sales restrictions

Restrictions on alcohol sales hours or days are commonly used tools in order to reduce alcohol consumption. However, a forward-looking consumer can buy in advance, and thereby mostly undo the impact of the restriction. I study whether time inconsistent consumer preferences can provide a justification for restrictions on alcohol sales time. I estimate a demand model, which allows a fraction of consumers to be time inconsistent, using scanner data of beer purchases and other shopping behavior. According to the estimation results, 16% of regular beer buyers, or only 3% of all consumers, behave as if they are time inconsistent. I find that in terms of consumer welfare, the sales restriction may be welfare improving, but is worse than increasing taxes.     

Cutting through the smoke: separating the effect of price on smoking initiation,relapse and cessation

I employ a large national representative dataset (Current Population Survey-Tobacco Use Supplements) to investigate how cigarette prices affect smoking decisions. A standard econometric approach is to estimate the relationship between cigarette prices and smoking participation at a point in time. I extend this approach to model past-year decisions to start, resume or quit smoking. Considering reverse causality, I apply an instrumental variable (excise taxes) for cigarette prices. I include an index of state-level anti-smoking sentiment to control for omitted variable bias. After estimating separate models for smoking initiation, relapse and cessation and for different age groups, I find no evidence that increasing taxes on cigarettes can prevent the onset of youth smoking. Neither does it effectively induce young smokers to quit. However, cigarette prices do play an important role to prevent relapse and encourage quitting at older ages.     

Possible Policies for Expansion

The Australian economy appears certain to be operating at well below full employment into 1992, or even longer. Further reductions in interest rates would operate on output only with long lags, and would be the most inflationary form of stimulus. But cuts in a wide range of indirect taxes, and tax incentives for new investment - especially if announced as temporary - would reduce the length and depth of the recession.
Results of simulations with macro-economic models for a number of countries imply that cuts in indirect taxes or in taxes on employment (either alone or in combination with other fiscal measures) reduce prices as well as stimulating employment and real output. Similar fiscal measures are likely also to improve the current account at any given level of employment or real output, and even more likely to increase the country's net wealth (private investment less the current account deficit).
Failure to adopt appropriate types of fiscal stimulus would reduce the benefits of microeconomic reform and make such reforms harder to achieve. Even if it were true that these forms of fiscal stimulus would not raise real output, the tax cuts in question would at least reduce inflation and could not then increase the current account deficit.     

The supply of effort in a fishery

This papers user a price-accounting approach to measure total factor productivity growth in Canadian manufacturing, at the two-digit level, over the period 1965–80. Its purpose is to describe how given productivity improvements have been apportioned among labour, capital, materials and government through an increase in the price of these factors or through an increase in taxes levied on factor inputs and ‘consumers’ through a decrease in the industry selling prices.     

The deterrent effects of the penalty points system for driving offences: a regression discontinuity approach

Using data on road accidents, traffic fatalities and driving offences taking place in Italy over the period 2001–2005, we estimate the effects of the introduction on July 2003 of a penalty points system for driving offences. To identify the causal effect of the penalty points system (PPS) on road safety we use a regression discontinuity design. It emerges that, controlling for weather conditions, police patrols, speed cameras, gasoline price, unemployment rate, the introduction of the PPS has led to a reduction of about 9 % of road accidents and of about 30 % of traffic fatalities. These findings are robust to different specifications of the model and different time windows. Moreover, it emerges that the driving offences for which the introduction of the new regime has determined a sharp change in the sanction scheme have reacted more than offences for which the change was less relevant.     

Riding the Energy Transition: Oil beyond 2040

Recent technological developments and past technology transitions suggest that the world could be on the verge of a profound shift in transportation technology. The return of the electric car and its adoption, like that of the motor vehicle in place of horses in early 20th century, could cut oil consumption substantially in the coming decades. Our analysis suggests that oil as the main fuel for transportation could have a much shorter life span left than commonly assumed. In the fast adoption scenario, oil prices could converge to the level of coal prices, about $15 per barrel in 2015 prices by the early 2040s. In this possible future, oil could become the new coal.     

Traffic accidents,deaths and alcohol consumption

The main goal of this article is to analyse the relationship existing among prices of alcoholic beverages, alcohol consumption and traffic fatalities for the Spanish Autonomous Communities during the time interval 1998 to 2002. Among the main results, we highlight a positive correlation between alcohol consumption and traffic mortality rate. Basically, governments implement two kinds of policies to reduce the traffic mortality rate. One is oriented to control the supply of alcohol by increasing alcohol taxes. The other is oriented to preserve traffic security, increasing the number of sanctions for traffic rule infraction. We find evidence that both policies exert a positive influence in the reduction of traffic fatalities. There is no empirical evidence to indicate that being a novice driver increases the tendency to be involved in a mortal traffic accident.     

Preferences for alternative fuel vehicles of company car drivers

Costs of car ownership for company cars drivers and private car owners are very different. Car use, car choice decisions and preferences for car characteristics may therefore differ substantially between these two markets. In this paper, we present results of a study on the preferences of company car drivers for alternative fuel vehicles and their characteristics, based on data from an online stated choice experiment in the Netherlands. Results show that, assuming current car characteristics, preferences for alternative fuel vehicles, and for electric and fuel cell cars in particular, are substantially lower than those for the conventional technology. Limited driving ranges, long recharge/refuelling times and limited availability of refuelling opportunities, are to a large extent responsible for this. Preferences for alternative fuel vehicles increase considerably with improvements on these aspects, especially for the hybrid and flexifuel car. Under the current company car tax system in the Netherlands, which favours cleaner technologies, these two car types are even preferred to the conventional technology, assuming equal catalogue prices and personal monthly cost contributions. Comparing results with those from a similar choice experiment among private car owners shows that willingness to pay patterns for AFV improvements regarding driving range, recharge and refuelling times, fuel availability and diversity in AFV supply, are considerably different for company car drivers than for private car owners. Company and private car drivers may therefore react (very) differently to future improvements in AFV technology and fuel availability. We finally show that preferences of company car drivers for fuel cell and electric cars depend to a large extent on annual mileage. Market share simulations show that potential early adopters of electric and fuel cell cars can be found among people with a relatively low annual mileage.     

A dynamic general equilibrium model of driving,gasoline use and vehicle fuel efficiency

The paper constructs a dynamic general equilibrium model to study the endogenous determination of gasoline use, driving and vehicle fuel efficiency. Before vehicles are produced, their fuel efficiency can be chosen optimally. Once produced, their fuel efficiency cannot be changed. The model generates endogenously different short-run and long-run price elasticities of gasoline use, with their magnitudes well within the region of plausible estimates in the empirical literature. The paper shows that although raising gasoline taxes and tightening the CAFE standard both reduce gasoline use in the long run, they are different in terms of the transmission mechanism, magnitudes of responses and dynamic paths of key endogenous variables.