We examine the impacts of increased US gasoline taxes in a model that links the markets for new, used, and scrapped vehicles and recognizes the considerable heterogeneity among households and cars. Household choice parameters derive from an estimation procedure that integrates individual choices for car ownership and miles traveled. We find that each cent-per-gallon increase in the price of gasoline reduces the equilibrium gasoline consumption by about 0.2 percent. Taking account of revenue recycling, the impact of a 25-cent gasoline tax increase on the average household is about $30 per year (2001 dollars). Distributional impacts depend importantly on how additional revenues from the tax increase are recycled. (JEL D12, H22, H25, L62, L71)

We examine the effects of urban form and public transit supply on the commute mode choices and annual vehicle miles traveled (VMTs) of households living in 114 urban areas in 1990. The probability of driving to work is lower the higher are population centrality and rail miles supplied and the lower is road density. Population centrality, jobs-housing balance, city shape, and road density have a significant effect on annual household VMTs. Although individual elasticities are small absolute values (≤0.10), moving sample households from a city with the characteristics of Atlanta to a city with the characteristics of Boston reduces annual VMTs by 25%. © 2005 President and Fellows of Harvard College and the Massachusetts Institute of Technology.

This paper explores the interactions between taxes on work-related traf®c congestion and preexisting distortionary taxes in the labor market. A congestion tax raises the overall costs of commuting to work and discourages labor force participation. The resulting welfare loss in the labor market can easily exceed the Pigouvian welfare gain from internalizing the congestion externality. However, if congestion tax revenues are used to reduce labor taxes, the net impact on labor supply is positive, and this can raise the overall welfare gain from the congestion tax by around 100 percent. Nonetheless the optimal congestion tax still equals the Pigouvian tax.

This paper explores the interactions between taxes on work-related traffic congestion and pre-existing distortionary taxes in the labor market. A congestion tax raises the overall costs of commuting to work and discourages labor force participation at the margin, when revenues are returned in lump-sum transfers. We find that the resulting efficiency loss in the labor market can be larger than the Pigouvian efficiency gains from internalizing the congestion externality. In contrast, if congestion tax revenues are used to reduce labor taxes the net impact on labor supply is positive, and the efficiency gain in the labor market can raise the overall welfare gains of the congestion tax by as much as 100 percent. Recycling congestion tax revenues in public transit subsidies produces a positive, but smaller, impact on labor supply.In short, our results indicate that the presence of pre-existing tax distortions, and the form of revenue recycling, can crucially affect the magnitude, and possibly even the sign, of the welfare effect of road-pricing schemes. The efficiency gains from recycling congestion tax revenues in other tax reductions can amount to several times the Pigouvian welfare gains from congestion reduction.

Bento, Cropper, Mobarak, and Vinha combine measures probability of driving to work in cities with some rail of urban form and public transit supply for 114 transit. Population centrality and jobs-housing balance urbanized areas with the 1990 Nationwide Personal have a significant impact on annual household vehicle Transportation Survey to address two questions: (1) miles traveled (VMT), as do city shape, road density, and How do measures of urban form, including city shape, (in rail cities) annual rail route miles supplied. The road density, the spatial distribution of population, and elasticity of VMT with respect to each variable is small, jobs-housing balance affect the annual miles driven and on the order of 0.10-0.20 in absolute value. However, commute mode choices of U.S. households? (2) How changing several measures of form simultaneously can does the supply of public transportation (annual route reduce annual VMT significantly. Moving the sample miles supplied and availability of transit stops) affect households from a city with the characteristics of Atlanta miles driven and commute mode choice?to a city with the characteristics of Boston reduces The authors find that jobs-housing balance, population annual VMT by 25 percent. centrality, and rail miles supplied significantly reduce the This paper-a product of Infrastructure and Environment, Development Research Group-is part of a larger effort in the group to examine factors affecting travel behavior.

Recent stGies find that envirormerital tax swaps Environm ental Policy, typical!y exacerhjat;e th-e cosEs and the "Double Dividend" oftorax sysrem rind therefore do not produc-H ypothesis "doubtl e dividend. This raper extends orevioujr mocels by incorporating tax-favorec' Ian Parry consumrrptionc goods. In tani Antonio Bento setting, .he efmiciency gains from ,-ec\!cng environonerren2a tax revenues are larger because preexisting ta,xer distoirt Lhe cons'"\i-p, ion burnde, in oadition to factoc rarke,. A genuire doubie divmicien is Then four,d.

Using geographically disaggregated data and exploiting an instrumental variable strategy, we show that, contrary to conventional wisdom, the benefits of the 1990 Clean Air Act Amendments (CAAA) were progressive. The CAAA created incentives for local regulators to target the initially dirtiest areas for cleanup, creating heterogeneity in the incidence of air quality improvements that favored lower-income households. Based on house price appreciation, households in the lowest quintile of the income distribution received annual benefits from the program equal to 0.3% of their income on average during the 1990s, over twice as much as those in the highest quintile.

No abstract