Understanding the Changes of Vehicle Miles Travelled in Response to Fuel Price and Fuel Efficiency for Different Income Groups

摘要

Fuel price is one of the most effective policy tools in regulating travel demand. Theeffects of fuel price on travel demand for different income groups reveal the choices andconstraints they are faced with. The first purpose of this study is to understand these underlyingchoices and constraints by examining the variation of fuel price elasticity of Vehicle MilesTravelled (VMT) across income groups. In the long run, improvement in fuel efficiency canresult in increases in VMT, which is known as the rebound effect; the rebound effect may offsetthe negative effect of fuel price on VMT. The second purpose of this study is, therefore, tocompare the relative magnitudes of the fuel price effect and the rebound effect. A sample of105,372 households from the 2009 National Household Travel Survey is divided into fiveincome quintiles and a Structural Equations System with VMT and fuel efficiency asendogenous variables is estimated for each quintile. Higher income group shows greater fuelprice elasticity than lower income group and the rebound effect is found to be only significant forthe lowest income quintile. We discuss that the relative inelasticity of the lower income group isdue to that they may be already traveling at a minimum to maintain a functional life and the largerebound effect of the lowest income quintile confirms that their travel demand is far fromsatiation. These findings emphasize policies aimed at reducing the basic travel needs of lowerincome groups and meanwhile, increasing their accessibility to other travel options.