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Replication data for: Using Loopholes to Reveal the Marginal Cost of Regulation: The Case of Fuel-Economy Standards

Version
V0
Resource Type
Dataset
Creator
  • Anderson, Soren T.
  • Sallee, James M.
Publication Date
2011-06-01
Description
  • Abstract

    Estimating the cost of regulation is difficult. Firms sometimes reveal costs indirectly, however, when they exploit loopholes to avoid regulation. We apply this insight to fuel economy standards for automobiles. These standards feature a loophole that gives automakers a bonus when they equip a vehicle with flexible-fuel capacity. Profitmaximizing automakers will equate the marginal cost of compliance using the loophole, which is observable, with the unobservable costs of strategies that genuinely improve fuel economy. Based on this insight, we estimate that tightening standards by one mile per gallon would have cost automakers just $9-$27 per vehicle in recent years. (JEL L51, L62, Q48)
Availability
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Relations
  • Is supplement to
    DOI: 10.1257/aer.101.4.1375 (Text)
Publications
  • Anderson, Soren T, and James M Sallee. “Using Loopholes to Reveal the Marginal Cost of Regulation: The Case of Fuel-Economy Standards.” American Economic Review 101, no. 4 (June 2011): 1375–1409. https://doi.org/10.1257/aer.101.4.1375.
    • ID: 10.1257/aer.101.4.1375 (DOI)

Update Metadata: 2020-05-18 | Issue Number: 2 | Registration Date: 2019-10-11

Anderson, Soren T.; Sallee, James M. (2011): Replication data for: Using Loopholes to Reveal the Marginal Cost of Regulation: The Case of Fuel-Economy Standards. Version: V0. ICPSR - Interuniversity Consortium for Political and Social Research. Dataset. https://doi.org/10.3886/E112433