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Economics of Transportation

Paper Session

Sunday, Jan. 5, 2025 1:00 PM - 3:00 PM (PST)

Hilton San Francisco Union Square, Union Square 6
Hosted By: Transportation and Public Utilities Group
  • Chair: Jonathan Hall, University of Alabama

Procurement with Bid Preference and Buyer’s Switching Costs: The Case of Municipal Buses

Filip Premik
,
Monash University

Abstract

I study a public procurement environment where buyers repeatedly purchase differentiated equipment, facing conflicting incentives: promoting competition among potential sellers lowers prices, while restricting competition helps buyers avoid the disruption of introducing new varieties. I construct novel data on fleet renewal by municipal bus operators in Poland, who use a common format of scoring auctions to favor incumbent bus producers, and show that operators with more homogeneous fleets perform better. Guided by these observations, I develop and estimate a structural model of auctions with bidder favoritism to quantify the main driving forces of the trade-off. The results indicate that policymakers should focus on encouraging procurement participation among potential sellers while allowing for favoritism to balance the buyers’ trade-off.

Internal Trade Barriers in India

Prabhat Barnwal
,
Michigan State University
Jonathan I. Dingel
,
Columbia University, NBER and CEPR
Daniil Iurchenko
,
University of Chicago
Pravin Krishna
,
Johns Hopkins University
Eva Van Leemput
,
Federal Reserve Board

Abstract

We study barriers to intranational trade in India, which has extensive roads but an inefficient transportation and logistics sector. The Goods and Services Tax (GST) introduced in 2017 imposed nationwide tax rates and eliminated the need for tax-collection checkposts at state borders. We quantify the impact of this checkpost reform using high-frequency Global Positioning System records, a survey of truck drivers, and trucking logs. The reform substantially sped up border crossings, with heterogeneous effects. Eastern states, which typically had slower checkposts prior to the reform, improved the most. Household expenditure rose in districts more exposed to these trucking improvements.

Decarbonizing Aviation: Cash-for-Clunkers in the Airline Industry

Jan K. Brueckner
,
University of California-Irvine
Matthew Kahn
,
University of Southern California
Jerry Nickelsburg
,
University of California-Los Angeles

Abstract

The durability of the transportation capital stock slows down the pace of decarbonization because newer vintages feature cutting-edge technology. If older vintages were retired sooner, the social cost of travel would decline. This paper analyzes the viability of a potential cash-for-clunkers program for the airline industry to hasten the decarbonization of aviation. Focusing on US aviation, our estimations and calculations show that airlines can be induced to scrap rather than sell older planes upon retirement with a payment that is less than the forgone carbon damage.

Paying at the Pump and the Ballot Box: Electoral Penalties of Motor Fuels Taxes

Matias Navarro
,
Cornell University
Gian-Claudia Sciara
,
University of Texas-Austin
Andrew Waxman
,
University of Texas-Austin

Abstract

We investigate the purported unpopularity of environmental taxes by examining whether politicians are punished by voters for increasing gas taxes. Leveraging a difference-in-discontinuities research design, we estimate the effect of legislated gasoline tax increases on incumbent state legislators' subsequent electoral outcomes. We provide empirical tests to ensure that variation in our gas tax variable is plausibly exogenous in our empirical setting. We find a small but economically and statistically meaningful penalty, representing 14–21% of the overall electoral advantage of incumbents in our sample. This highlights the relative importance of environmental and energy taxes in voter priorities.

Discussant(s)
Konan Hara
,
University of Arizona
Marco Gonzalez-Navarro
,
University of California-Berkeley
Yucheng Wang
,
University of Pittsburgh
Michael Anderson
,
University of California-Berkeley
JEL Classifications
  • R4 - Transportation Economics