Resumen de Changes in fuel economy:: An analysis of the Spanish car market
Anna Matas, José Luis Raymond Bara, Andrés Domínguez
This paper estimates the role that technological change and car characteristics have played in therate of fuel consumptionof vehicles over time. Using data from the Spanish car market from 1988 to 2013, we estimate a reduced form equation that relates fuel consumption with a set of car characteristics. The resultsfor the sales-weighted sample of vehiclesshow that energy efficiency would have improved by 30% and 42% for petrol and diesel cars respectively had car characteristics been held constant at 1988 values. However, the shift to bigger and more fuel-consuming cars reduced the gains from technological progress. Additionally, usingthe results of the fuel equation we show that, besides a natural growth rate of 1.1%, technological progress isaffected by both the international price of oil and the adoption of mandatory emission standards. Moreover, according to our estimations, a 1% growth in GDP would modify car characteristics in such a way that fuel consumption would increase by around 0.23% for petrol cars and 0.35% for diesel cars.
