MIT energy economist Christopher Knittel says a gas tax would pay for itself, or nearly so, with the benefits the tax would bring:
Fuel for thought, by Peter Dizikes, MIT News Office: …Christopher Knittel … is the William Barton Rogers Professor of Energy Economics at the MIT Sloan School of Management…
Knittel’s research addresses a clutch of practical and linked questions: How much progress have automakers made on fuel efficiency? (More than you might think.) How do car owners respond when fuel prices rise? (They really do ditch their gas-guzzlers.) How large are the collateral health benefits of removing dirty vehicles from the nation’s fleet? (Very large.) …
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Cars and light trucks produce about 15 percent of U.S. greenhouse gases. The best policy for reducing energy consumption from those sources, Knittel believes, would be higher fuel prices. “That would incentivize all the things we want,” Knittel says. “When gas prices go up, people shift to more fuel-efficient cars, they drive fewer miles, and insofar as there are lower-carbon-intensive fuels out there, people shift to them. They get rid of their clunkers faster.”
That’s not just an assumption; Knittel has studied the responses of auto owners nationwide to rising gas prices from 1999 to 2008 in another research paper, “Pain at the Pump,” co-authored with Meghan Busse and Florian Zettelmeyer of Northwestern University. The researchers found that with each $1 rise in the price of gas, purchases of highly fuel-efficient autos increase 21 percent, while purchases of gas-guzzling vehicles drop 27 percent.
A shift to newer, more fuel-efficient vehicles would actually help people in another way, besides releasing fewer greenhouse gases: It would reduce the amount of harmful local pollution in the air, as Knittel detailed in a paper written with Ryan Sandler of U.C. Davis, based on a study of California from 1998 to 2008. “When gas prices go up, you’re getting bigger mileage reductions from cars that are worse in terms of these pollutants,” Knittel observes.
That produces significant health benefits beyond the problems associated with climate change. “We’re talking about asthma attacks and respiratory problems,” he adds. “This isn’t just a matter of helping the world two generations from now. You can point to this and say, ‘Here is a more immediate, salient reason for a gas tax.’” According to Knittel and Sandler, 70 percent of the costs of a gas tax of $1 per gallon could be recouped by immediate health benefits from reduced pollution. Other possible benefits from the tax — reductions in climate change, traffic congestion and accidents — could make it a net winner for people
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As a resident of a town with no appreciable traffic congestion (except football weekends*) and sufficient wind to almost always prevent the kind of local health problems from gasoline consumption, I’d like to note that we can improve the efficiency of the proposed gas tax by making it higher than $1 a gallon in major metropolitan areas and significantly lower in areas far from such metropolitan areas.
Raising the gasoline tax in non-metropolitan areas has little to no congestion benefits and likely modest health benefits from reductions in local air pollution. That leaves external costs from accidents and climate change benefits from raising a gasoline tax as good grounds for a gasoline tax.
*And the current coach is doing what he can to moderate congestion on football game days, even if unintentionally. -
Right on, non-uniformity is a good thing. Of course, once everyone
realizes there is a lower gas tax in Lubbuck they'll all move there
(or drive there for their gas). -
You’re probably safe in Watauga County, NC, too. Columbus, OH, on the other hand…
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“(or drive there for their gas).”…. I don’t think you appreciate how isolated Lubbock is. It would have be a pretty substantial difference in price to drive over 60 niles one way to buy cheaper gas…
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Rene,
That was the joke!!! -
It is better if at least some of the proceeds are directed towards, say, lighter-weight car components, or attempting to scale-up the odd ecomony-of-scale of new solely battery powered fleets, say with Crown fleet inner city purchases and electrical sockets on parking lots in hydro cities. There may be a 15 million year carbon sequester method out there that sequesters 2/3 or more of a log as fossil wood (a Belgium bog I think?) indicates. A change in lignin protects the cellulose. Maybe constant bog or frozen conditions. Maybe buried by clay. Maybe pressure from ice ages. It might be easily reproducible by burial in fuscum bogs, more expensive if clay, or non economical if something capital intensive.
That got me thinking about the ROI of sequestering for 150 vs 15000 vs 15 mil years. As capital equipment turnover becomes unpredictable (WMDs), at best we can scale-down some sectors and turn NSA into KGB. Delaying researcher blueprint clearances and such forth…
This means our GDP growth may eventually peak below a level of technology sufficient to cheaply generate electricity (past a threshhold) or invent stable C-sequester. If so, a shorter-term CO2/c results in increased odds of inferior GDP growth and potentially dystopies.
Capital turnover of mind control, bioterror sectors, nukes…if these increase fast or if famines and pandemics unless anarchy/tyranny, would want longer-term sequester; at least a few hundred years seems a minimum.
It should be possible to genetically engineer tamarack/pine tree varieties, or perhaps shrubs, that have lignins protecting cellulose, hopefully underneath Hundson’s Bay lowlands. The concentric ripples every 100m should isolate effects of experiments. Perhaps clay would be needed and solar or wind powered drills? -
It’s good to see research in this field. Now, we need an epidemiological study showing that asthma attacks and the like actually did decrease during those jumps in gas prices.
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