There is a debate among policy analysts about whether fuel taxes alone are the most effective policy to reduce fuel use by motorists, or whether to also use mandatory standards for fuel efficiency. A problem with a policy mandating fuel economy standards is the"rebound effect,"whereby owners...

Without continuous monitoring of emissions, a pollution control agency needs to evaluate abatement options itself. Apart from making activities cleaner, it should also stimulate reductions in the level of activity in polluting sectors. The author develops an analytical framework to show that a...

Charging for social marginal costs is efficient regardless of price elasticities, but the importance of getting prices"right"is greater the more manageable, or elastic, the demand. In efficient pollution control programs, options to make cars cleaner are combined optimally with demand...

In November 1989, Mexico City's administration imposed a regulation banning each car from driving on a specific day of the week. The regulation has been both popular and controversial. Some feel that it is a reasonable concession aimed at alleviating congestion and pollution problems. Others...

Sound public policy addresses externalities directly, when possible. Air pollution is best alleviated by policy instruments that internalize the social cost of pollution, making it attractive to reduce emissions. One such instrument might be a tax levied on individual emissions, if they are...

How would travel demand in Sao Paulo respond to demand management instruments? Could higher gasoline prices or lower metro fares (or changes in travel time) help reduce congestion or pollution? The authors use cross-sectional variation from an urban travel survey to study the substitutability in...