Can a Reduction in Fuel Use Result from an Endogenous Technical Progress in Motor Vehicles? A Partial and General Equilibrium Analysis

Figus, Gioele and Swales, J Kim and Turner, Karen (2017) Can a Reduction in Fuel Use Result from an Endogenous Technical Progress in Motor Vehicles? A Partial and General Equilibrium Analysis. Discussion paper. University of Strathclyde, Glasgow.

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    Abstract

    In this paper we employ a partial equilibrium approach to model private transport consumption as a household self-produced commodity formed by vehicle and fuel use. We show that under certain conditions vehicle-augmenting technical improvements can reduce fuel use. We then extend the analysis through Computable General Equilibrium simulations for the UK in order to investigate the wider implications of vehicle-augmenting efficiency improvements when prices and nominal income are endogenous. With a conventional macroeconomic approach, improvements in the efficiency of household consumption simply change the composition of household demand. However, when we adjust the consumer price index for changes in the price of private transport service (not observable via a market price), as advocated in Gordon (2016) there is an additional supply-side stimulus to competitiveness.

    Creators(s): Figus, Gioele ORCID logoORCID: https://orcid.org/0000-0002-2642-5504, Swales, J Kim and Turner, Karen;
    Item type:Monograph(Discussion paper)
    ID code:61001
    Notes:A discussion paper published as part of the University of Strathclyde Business School "Discussion Papers in Economics" series. 17-05.
    Keywords:transport policy, Computable General Equilibrium simulations, energy efficiency, Economic Theory, Energy (miscellaneous), Economics, Econometrics and Finance (miscellaneous)
    Subjects:Social Sciences > Economic Theory
    Department:Strathclyde Business School > Economics
    Strathclyde Business School > Fraser of Allander Institute
    Faculty of Humanities and Social Sciences (HaSS) > International Public Policy Institute (IPPI)
    Strategic Research Themes > Energy
    Depositing user: Pure Administrator
    Date deposited:20 Jun 2017 10:53
    Last modified:20 Mar 2020 02:24
    URI:https://strathprints.strath.ac.uk/id/eprint/61001
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