Fuel economy standards change the composition of the vehicle fleet,
influencing accident safety. The direction and size of the effect depend
on the combination of vehicles in the fleet. I provide empirical estimates
of vehicle safety across classes, accounting for unobserved
driving behavior and selection. I apply the model to the present
structure of US fuel economy standards, accounting for shifts in the
composition of vehicle ownership, and estimate an adverse safety
effect of 33 cents per gallon of gasoline saved. I show how two alternative
regulatory provisions fully offset this effect, producing a nearzero
change in accident fatalities.
Jacobsen, Mark R.
"Fuel Economy and Safety: The Influences of Vehicle Class and Driver Behavior."
American Economic Journal: Applied Economics,
Consumer Economics: Empirical Analysis
Economics of Regulation
Automobiles; Other Transportation Equipment
Energy: Government Policy
Transportation: Demand, Supply, and Congestion; Safety and Accidents; Transportation Noise