Attribute substitution in household vehicle portfolios

A-Tier
Journal: RAND Journal of Economics
Year: 2020
Volume: 51
Issue: 4
Pages: 1162-1196

Score contribution per author:

1.005 = (α=2.01 / 4 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Roughly three quarters of vehicles are purchased into multi‐car households. We study whether households are willing to substitute attributes, such as fuel economy, across vehicles within their portfolio. We develop a novel strategy to separately identify idiosyncratic preferences for an attribute from these within‐portfolio effects. Using the universe of household vehicle registration records in California over a 6‐year period, we find that two‐car households exhibit strong substitution across vehicles when faced with an exogenous change to fuel intensity of a kept vehicle. This effect can erode a substantial portion of the benefit from major policies, such as Cash‐for‐Clunkers.

Technical Details

RePEc Handle
repec:bla:randje:v:51:y:2020:i:4:p:1162-1196
Journal Field
Industrial Organization
Author Count
4
Added to Database
2026-01-24