The effectiveness of price and tax measures for reducing car mobility depends on the way drivers react to them. The parallel increase of fuel taxes and traffic volumes in the past years gives the superficial impression that such measures are ineffective. However, taking a closer look at the issue by means of econometric research consistently shows a significant behavioural response. The research discussed here even suggests that changes in fuel prices induce drivers to adapt their driving style and, through that, fuel use per kilometer driven. The data refer to 1986, a year in which fuel prices decreased substantially. The results provide an explanation for the observed gap between the price elasticity of car fuel demand and that of the number of kilometers driven by car. More generally, it gives support to those theories that explain driver behaviour as the result of a comparison of costs and benefits. (A)
Abstract