2 Items

Discussion Paper

Do Public Subsidies Sell Green Cars?

| December 2010

One question about the 2009 U.S. "Cash for Clunkers" program is whether it induced consumers to purchase greener vehicles than they would otherwise have purchased. This paper views the program as a natural experiment, which offered higher rebates to consumers buying more fuel-efficient vehicles, and shows that awarding an extra $1,000 on a vehicle made 7.2% of consumers switch. Hence the program - giving away nearly $3 billion - should have drawn many consumers to the subsidized greener vehicles, producing substantial environmental gains. This finding should interest policymakers evaluating similar programs to stimulate the economy while benefiting the environment.

Discussion Paper

Transportation Revenue Options: Infrastructure, Emissions, and Congestion

| September 2010

The report is a summary of the discussions from a workshop on "Transportation Revenue Options" convened by the Belfer Center in May 2010. The workshop brought together 27 transportation experts for a two-day workshop to discuss three broad revenue-generating options: higher fuel taxes — perhaps supplemented by a carbon tax; fees collected based on vehicle miles traveled (VMT); and congestion fees on major roadways.