Petrol expenditure and redistributive effects of its taxation in Spain

The objective of this paper is to estimate a petrol expenditure function for Spain and to evaluate the redistributive effects of petrol taxation. We use micro data from the Spanish Household Budget Survey of 1990/91 and model petrol expenditure taking into account the effect that income changes may have on car ownership levels, as well as the differences that exist between reported expenditure and real consumption during the week of reference. Our results show the importance that household structure, place of residence and income have on petrol expenditure patterns. We are able to compute income elasticities of petrol expenditure, both conditional and unconditional on the level of car ownership. Non-conditional elasticities, while always very close to unit values, are lower for higher income households and for those living in rural areas or small cities. When car ownership levels are taken as fixed, the conditional elasticity obtained is around one half the value of the non-conditional ones. As regards the redistributive effects of petrol taxation, we observe that for the lowest income deciles the share of petrol expenditure increases with income, and thus the tax can be regarded as progressive. However, after a certain income level the tax proves to be regressive.     

Modelling car ownership in Great Britain

Over the last 50 years there has been a tenfold increase in the number of cars in Great Britain, rising from 2.6 million vehicles in 1951 to 27 million vehicles in 2001. Over the same period there has been a steady reduction in the proportion of households without access to a car and a steady increase in the proportion of households with two or more cars. If such trends continue, it is likely that there will be increased energy consumption, increased problems with traffic congestion and atmospheric pollution, and reductions to the financial viability of public transport. Given the importance of car ownership to transport and land-use planning and its relationship with energy consumption, the environment and health, it is the objective of this research to develop econometric models of household car ownership and apply the models to generate forecasts across Britain to the year 2031. To achieve this objective, the research develops discrete choice models of the household’s decision to own zero, one, two or three or more vehicles as a function of market saturation, licence holding, household income and structure, household employment, company car provision, and purchase and use costs. The models are validated to data from the 2001 Census and are used to develop a range of forecasts taking into account changes to the socio-demographic characteristics of Britain.     

Changes in fuel economy: An analysis of the Spanish car market

This paper estimates the role that technological change and car characteristics have played in the rate of fuel consumption of vehicles over time. Using data from the Spanish car market from 1988 to 2013, we estimate a reduced form equation that relates fuel consumption with a set of car characteristics. The results for the sales-weighted sample of vehicles show that energy efficiency would have improved by 30% and 42% for petrol and diesel cars respectively had car characteristics been held constant at 1988 values. However, the shift to bigger and more fuel-consuming cars reduced the gains from technological progress. Additionally, using the results of the fuel equation we show that, besides a natural growth rate of 1.1%, technological progress is affected by both the international price of oil and the adoption of mandatory emission standards. Moreover, according to our estimations, a 1% growth in GDP would modify car characteristics in such a way that fuel consumption would increase by around 0.23% for petrol cars and 0.35% for diesel cars.     

A dynamic analysis of household car ownership

This paper examines the determinants of household car ownership, using Irish longitudinal data for the period 1995–2001. This was a period of rapid economic and social change in Ireland, with the proportion of households with one or more cars growing from 74.6% to 80.8%. Understanding the determinants of household car ownership, a key determinant of household travel behaviour more generally, is particularly important in the context of current policy developments which seek to encourage more sustainable means of travel. In this paper, we use longitudinal data to estimate dynamic models of household car ownership, controlling for unobserved heterogeneity and state dependence. We find income and previous car ownership to be the strongest determinants of differences in household car ownership, with the effect of permanent income having a stronger and more significant effect on the probability of household car ownership than current income. In addition, income elasticities differ by previous car ownership status, with income elasticities higher for those households with no car in the initial period. Other important influences include household composition (in particular, the presence of young children) and lifecycle effects, which create challenges for policymakers in seeking to change travel behaviour.     

The transaction cost approach to modeling the demand for automobiles

The purchase of an automobile involves significant transaction costs in addition to the purchase price. Therefore, the assumptions implied by static car holding models are invalid. This paper describes a dynamic approach to the modeling of level-of-ownership and auto-type choice, based on a transaction choice model which utilizes information on past car ownership. The cost or disutility of a transaction depends on the attributes of the household and the purchased car, as well as on past car-ownership characteristics. A set of assumptions underlying the incorporation of transaction costs in the model is presented. The paper discusses the econometric implications of omitting the dynamic attributes (i.e., past ownership characteristics). A disaggregate model was estimated, using a choice-based sample consisting of a random sample of households enriched with a sample of households which transacted in the car market during the study period. This sampling method combined with a random choice of a subset of the car alternatives provides for a cost-effective method to estimate a transaction model.     

From e-bike to car: A study on factors influencing motorization of e-bike users across China

Household car ownership has risen dramatically in China over the past decade. At the same time a disruptive transportation technology emerged, the electric bike (e-bike). Most studies investigating motorization in China focus on macro-level economic indicators like GDP, with few focusing on household, city-level, environmental, or geographic indicators, and none in the context of high e-bike ownership. This study examines household vehicle purchase decisions across 59 cities in China with broad geographic, environmental, and socio-economic characteristics. We focus on a subset of households who own e-bikes and rely on a telephone survey from an industry customer database. From these responses, we estimate two three-level hierarchical choice models to assess attributes that contribute to (1) recent car purchases and (2) the intention to buy a car in the near future. The results show that the models are dominated by household characteristics including household income, household size, household vehicle ownership, number of licensed drivers and duration of car ownership. Some geographic, environmental and socio-economic factors have significant influences on car purchase decisions. Only two city-level transportation variable have an effect – higher taxi density and higher bus density reducing car purchase. Cold weather, population density gross domestic product per capita positively influence car purchase, while urbanization rate reduces car purchase. Because of supply heterogeneity in the data set, described by publicly available urban transportation data, this is the first study that can include geographic and urban infrastructure differences that influence purchase choice and suggests potential region-specific policy approaches to managing car purchase may be necessary.     

Changes in level of household car ownership: the role of life events and spatial context

Recent longitudinal studies of household car ownership have examined factors associated with increases and decreases in car ownership level. The contribution of this panel data analysis is to identify the predictors of different types of car ownership level change (zero to one car, one to two cars and vice versa) and demonstrate that these are quite different in nature. The study develops a large scale data set (n = 19,334), drawing on the first two waves (2009–2011) of the UK Household Longitudinal Study (UKHLS). This has enabled the generation of a comprehensive set of life event and spatial context variables. Changes to composition of households (people arriving and leaving) and to driving licence availability are the strongest predictors of car ownership level changes, followed by employment status and income changes. Households were found to be more likely to relinquish cars in association with an income reduction than they were to acquire cars in association with an income gain. This may be attributed to the economic recession of the time. The effect of having children differs according to car ownership state with it increasing the probability of acquiring a car for non-car owners and increasing the probability of relinquishing a car for two car owners. Sensitivity to spatial context is demonstrated by poorer access to public transport predicting higher probability of a non-car owning household acquiring a car and lower probability of a one-car owning household relinquishing a car. While previous panel studies have had to rely on comparatively small samples, the large scale nature of the UKHLS has provided robust and comprehensive evidence of the factors that determine different car ownership level changes.     

The effect of prices and income on car travel in the UK

The objective of this paper is to analyse the factors determining household car travel, and specifically the effects of household income and the prices of cars and motor fuels, and to explore the intertemporal pattern of adjustment. The question of asymmetry in the response to rising and falling income is also addressed. Such asymmetry may be caused by habit or resistance to change or the tendency to acquire habits to consume more easily than to abandon them. The impact of prices, the speed of adjustment and the resistance to change will be important in determining the possibility of influencing travel behaviour and specifically car use. The study utilises repeated cross-section data from the annual UK Family Expenditure Surveys and employs a pseudo-panel methodology. The results are compared with those for car ownership estimated on the basis of similar models.     

The residential parking rent price elasticity of car ownership in Japan

By using household-level micro data captured through the National Survey of Family Income and Expenditure for 2004, this study evaluates the residential parking rent price elasticity of car ownership in Japan. It analyzes the number of cars owned by a household, using various attributes including expenditure for renting a parking space on a monthly basis. The estimation results derived from the IV-ordered probit model show that the absolute value of parking rent price elasticity of car ownership is, at most, 0.48, which is fairly small (i.e., inelastic). The elasticity value varies depending on city size; for megacities, elasticity is always negative for car ownership, whereas for middle-sized or small cities, towns, and villages, elasticity is positive for one-car ownership and negative for the ownership of more than one car. Hence, when the price of parking increases, some people may switch from more than one car to one car and some people in megacities may switch from one to zero cars. Indeed, the net effect of a price increase may be that non-car ownership increases in megacities and one-car ownership increases in other cities.     

Asymmetry in transport fuel demand: Evidence from household level data

Models for gasoline demand for transportation activities generally assume that demand is perfectly reversible with respect to gasoline price (and income). The small literature which relaxes the reversibility assumption in gasoline demand argues technological fixation leads to this asymmetry and utilizes aggregate time-series model to find evidence in favour of asymmetry. In this research it is suggested that there could also be behavioural factors behind this asymmetric response, possibly due to the loss aversion nature of human beings as described in the prospect theory. For the first time, household level data was used to understand asymmetry in gasoline demand in response to changes in gasoline price and income. There was statistical evidence that gasoline price and income both can induce asymmetric changes in gasoline demand among households. Specifically, elasticity with respect to rising prices and falling income is larger than the elasticity with respect to falling prices and rising income respectively, which is consistent with loss aversion in gasoline purchase behaviour. There was also some evidence of heterogeneity in the asymmetric responses between urban and rural households. The results have implications for transport-related energy tax policies or subsidies, while the method can be applied directly for non-energy goods as well.     

Do fewer people mean fewer cars? Population decline and car ownership in Germany

Drawing on household data from Germany, this study econometrically analyzes the determinants of automobile ownership, focusing specifically on the extent to which decreases in family size translate into changes in the number of cars at the national level. Beyond modeling several variables over which policy makers have direct leverage, including the proximity of public transit, fuel prices and land use density, the analysis uses the estimated coefficients from a multinomial logit model to simulate car ownership rates under alternative scenarios pertaining to demographic change and other socio-economic variables. Our baseline scenario predicts continued increases in the number of cars despite decreases in population, a trend that is attributed to continued increases in household income.     

Are multi-car households better suited for battery electric vehicles? – Driving patterns and economics in Sweden and Germany

Battery electric vehicles (BEVs) could reduce CO₂ emissions from the transport sector but their limited electric driving range diminishes their utility to users. The effect of the limited driving range can be reduced in multi-car households where users could choose between a BEV and a conventional car for long-distance travel. However, to what extent the driving patterns of different cars in a multi-car household’s suit the characteristics of a BEV needs further analysis. In this paper we analyse the probability of daily driving above a fixed threshold for conventional cars in current Swedish and German car driving data. We find second cars in multi-car households to require less adaptation and to be better suited for BEV adoption compared to first cars in multi-car households as well as to cars in single-car households. Specifically, the share of second cars that could fulfil all their driving is 20 percentage points higher compared to first cars and cars from single-car households. This result is stable against variation of driving range and of the tolerated number of days requiring adaptation. Furthermore, the range needed to cover all driving needs for about 70% of the vehicles is only 220 km for second cars compared to 390 km for the average car. We can further confirm that second cars have higher market viability from a total cost of ownership perspective. Here, the second cars achieve a 10 percentage points higher market share compared to first cars, and to cars in single-car households for Swedish economic conditions, while for Germany the corresponding figure is 2 percentage points. Our results are important for understanding the market viability of current and near-future BEVs.     

Variations in household transport expenditure within major Australian cities

A comparative analysis of intra‐urban variations in household transport expenditure in 1966–68 is undertaken for the two largest Australian cities, Sydney and Melbourne, and one of the smaller State capitals, Adelaide. Regional variations in transport expenditure are found to be greater the larger the city; however residents of small cities are more dependent upon the car for their motorised travel. In the larger cities car dependence is most evident among low‐to‐middle income groups at a relatively early stage in the life cycle, located in outer suburban areas. Consequently high levels of expenditure on transport typically coincide with relatively high levels of financial commitments to home purchase and/or operation. This has significant ramifications for the household budget, the most notable being deficit‐funding, and reduced outlays on other expenditure items such as recreation and education. The distribution of company vehicles and allowances is shown to be of relatively greater benefit to higher income groups, although is not confined to them. Although somewhat dated, the findings suggest that the social impacts of rising prices for energy will almost certainly be regressive.

Note: This paper was presented to the 7th PTRC Summer Annual Meeting held at the University of Warwick in July 1979. The authors gratefully acknowledge the contribution of the Australian Road Research Board in the preparation of the paper. Particular appreciation is expressed to Dr. M. R. Wigan, Mr. K. Sharp and Dr. M. G. Lay for their helpful comments.     

Demand forecasting of diesel passenger car considering consumer preference and government regulation in South Korea

Changing market regulations in South Korea have allowed diesel-fueled passenger cars in the domestic market. The diffusion of diesel cars is tied to issues of environmental impact, energy supply and demand, and changes in tax revenue. Policymakers can influence demand for diesel vehicles to protect social welfare and to observe international environmental protection laws. On the supply side, carmakers need to know consumer preferences regarding new vehicles to arrive at development strategies.This study uses microsimulated demand forecasting to address these issues and predict consumer demand for diesel passenger cars. The model accommodates governmental policies and car attributes such as price and engine efficiency. We find that consumers will likely prefer diesel passenger cars to gasoline ones due to the low operation costs of the former in spite of high purchase price when diesel is relatively cheaper than gasoline. Finally we find that diesel passenger cars will capture a 42% market penetration ratio under the pricing system suggested by the Ministry of Environment of Korea.     

Household-level commuting mode choices,car allocation and car ownership level choices of two-worker households: the case of the city of Toronto

The paper presents a comprehensive investigation on household level commuting mode, car allocation and car ownership level choices of two-worker households in the City of Toronto. A joint econometric model and a household travel survey dataset are used for empirical investigations. Empirical models reveal that significant substitution patterns exist between auto driving and all other mode choices in two-worker households. It is revealed that, female commuters do not prefer auto driving, but in case of a one car (and two commuters with driving licenses) household, a female commuter gets more preference for auto driving option than the male commuter. Reverse commuting (commuting in opposite direction of home to central business district) plays a critical role on household level car allocation choices and in defining the stability of commuting behaviour of two-worker households. Two worker households in higher income zones and with longer commuting distances tend to have higher car ownership levels than others. However, higher transit accessibility to jobs reduces household car ownership levels. The study reveals that both increasing two worker households and reverse commuting would increase dependency on private car for commuting.     

Estimating the long-term effects of different passenger car technologies on energy/fuel consumption and emissions of greenhouse gases in Europe

Abstract

A stated preference (SP) experiment of car ownership was conducted in Mumbai Metropolitan Region (MMR) of Maharashtra in India. A full factorial experiment was designed to considering various attributes such as travel time, travel cost, projected household income, car loan payment and servicing cost. Data on 357 individuals were collected which resulted in 3213 observations for the calibration of the work trip and recreational trip car ownership models. The car ownership alternatives considered 0, 1 and 2 cars. A multinomial logit framework was used to develop the car ownership model taking the household as a decision unit. The specification and results of the SP car ownership model are discussed. The observed and predicted values matched reasonably when the validity of the SP car ownership model was tested against revealed preference (RP) data. The car ownership models developed in this study exhibit a satisfactory goodness of fit. It is concluded that the SP modelling approach can be successfully used for modelling car ownership decisions of households in developing countries.     

Auto travel fuel elasticity in a rapidly developing urban area

This paper presents results of a study conducted to quantify the effect of fuel cost increases on household auto travel in Riyadh, the rapidly developing capital of Saudi Arabia. Responses of a stratified random sample of 1648 individual households provided the data base for the analysis. The auto trip measures of shrinkage ratio, arc and log-arc elasticities were calculated for households categorized by income and family size. The elasticity measures suggested the existence of significant relationship among the factors of fuel cost, the number of daily auto trips, and family size. It was found that as fuel prices increased, the number of daily trips decreased, and that this decrease in daily trips was greater with larger family size. A step-wise multiple regression analysis with three independent variables of car ownership, family size, and daily fuel expenditures was developed. The model was fairly accurate in predicting variations in daily household travel. The regression parameter of the variable fuel cost was also used to derive demand elasticity to fuel expenditures. Elasticity measures ranged between -0.30 and -0.37.     

Analysis of equilibrium automobile holdings in Israel with aggregate discrete choice models

Models of household vehicle ownership decisions do not suffice as a basis for forecasting the size and composition of aggregate vehicle holdings. Forecasting applications require that such models be imbedded in systems describing the operation of the automobile market. This paper presents a new model of short run equilibrium in the automobile market. The short run is a period within which new car designs and prices are fixed but used car prices adjust competitively to market forces. The magnitude and mix of new car sales, the extent of used car scrappage and the composition of used car holdings are determined in equilibrium with used car prices. An econometric version of the market model has been estimated on Israeli data and applied to analyze the impact of vehicle tax policy on automobile holdings in Israel. The paper describes this application.     

A note on implicit consumer discounting of automobile fuel economy: Reviewing the available evidence

A key element in the long run response of the automotive market to higher fuel prices is consumers' willingness to pay for fuel economy improvements. Eight recent studies are examined and estimates of asset price/operating cost discount rates are derived for each. A critical comparison of results suggests that most are implausible. Plausible estimates range from 4 to 40% as a function of household income.     

Electric vehicles in car sharing networks – Challenges and simulation model analysis

In this paper, we examine the operation of electric vehicles in urban car sharing networks. After surveying strategic and operational differences and comparing them to gasoline-fueled cars, a simulation study was carried out. The proposed discrete event simulation tool covered important operational characteristics of electric vehicles, including realistic charging routines. Different vehicle types were compared under various conditions and on multiple markets to determine their performance. The data obtained indicated the competitiveness of electric vehicles in car sharing networks. Key success factors included advantageous relations between the market environment (e.g. electricity and fuel prices) and important characteristics of electric cars (e.g. price and range).