Working Paper: NBER ID: w23076
Authors: Hunt Allcott; Christopher Knittel
Abstract: It is often asserted that consumers are poorly informed about and inattentive to fuel economy, causing them to buy low-fuel economy vehicles despite their own best interest. This paper presents evidence on this assertion through two experiments providing fuel economy information to new vehicle shoppers. Results show zero statistical or economic effect on average fuel economy of vehicles purchased. In the context of a simple optimal policy model, the estimates suggest that current and proposed U.S. fuel economy standards are significantly more stringent than needed to address the classes of imperfect information and inattention addressed by our interventions.
Keywords: behavioral; public economics; fuel economy standards; field experiments; information provision
JEL Codes: D12; D83; L15; L91; Q41; Q48
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| fuel economy information (R48) | average fuel economy of purchased vehicles (L62) |
| fuel economy information (R48) | consumer purchasing behavior (D19) |
| fuel economy information (R48) | stated importance consumers placed on fuel economy (D12) |
| fuel economy information (R48) | consumer preferences regarding fuel economy (D11) |
| fuel economy information (R48) | switching from lower to higher fuel economy vehicles (R48) |