Cristian Huse's research

Working Papers  

Policy Instruments to Reduce Carbon Emissions for Road Transport
with Davide Cerruti
This chapter surveys policy instruments aiming at reducing carbon emissions from road transport. We present the basic economic framework used to evaluate environmental policy instruments and discuss the challenges and limitations it faces, which are important enough to justify departures from the first-best
instrument (Pigouvian tax). We then discuss a number of policy instruments, including fuel and mileage taxes, standards, different forms of vehicle taxes, feebates, scrappage and information programs as well as congestion pricing, driving restrictions, and public transport policies. We aim to strike a balance between real-life applications and economic intuition, emphasizing pros and cons of policy instruments as well as the margins they affect, all to provide the reader with a well-rounded view of the topic. We conclude by discussing how the impending changes in the transport sector, such as the diffusion of new technologies and business models, are expected to call for new solutions from policy-makers.
-- paper
Version: July 2019

Kill Two Birds with One Stone? Environmental Policy Design with Multiple Targets in the Swedish Car Market
with Claudio Lucinda
We perform an ex ante analysis of the effects of environmental policies on the attainment of EU-mandated targets of CO2 emissions and the renewable fuel standard. To do so, we estimate a structural model for the Swedish new vehicle market allowing for consumer heterogeneity and endogenous product characteristics to model the responses of carmakers. Policy simulations suggest that attaining the EU targets using only demand-based policy instruments such as a rebate is not feasible. Thus, policymakers need to implement additional instruments in order to incentivize the introduction of more fuel efficient models in the new vehicle market.
LyX Document -- under revision

Fast and Furious (and Dirty): How Asymmetric Regulation May Hinder Environmental Policy
--Winner of the Public Utility Research Prize for the best paper in regulatory economics at the International Industrial Organization Conference (IIOC)
-- under revision


Quantifying The Effects of Natural Hedging -- An Examination of US Production for BMW and Porsche
with Richard Friberg  
-- paper
Version: July 2014

Estimating the 'Coordinated Effects' of Mergers
with Peter J. Davis

-- paper
Version: January 2010


 Journal Publications  

(2022): Salience and Policy Instruments: Evidence from the Auto Market
with Nikita Koptyug
JAERE -- Journal of the Association of Environmental and Resource Economists
We take advantage of a unique institutional setting which allows consumers to separately value the fuel tax and the vehicle tax (road tax). We estimate a consumer-level structural model of vehicle choice using revealed preference data and controlling for heterogeneity at the micro level. We find that consumers undervalue both policy instruments, but undervaluation of the latter is substantially more severe. We examine potential explanations and document that behavioral explanations, in particular salience of the policy instruments, lie at the root of our findings; for a number of the salient versions of vehicle tax and fuel costs we construct, we cannot reject the null hypothesis of their correct valuation. This also holds when using different measures of news and online search activity as proxies for salience. The results call for complementary policy instruments to restore market efficiency and for measures to make them more salient to consumers.
-- paper

(2021): Assessing the Effects of a Large Temporary Energy Savings Program: Evidence from a Developing Country
with Claudio Lucinda and Andre Ribeiro
JEEM -- Journal of Environmental Economics and Management
We examine the effects of a large temporary energy-savings program on the valuation of energy efficiency by Brazilian households, as well as its counterfactual energy savings. Using a representative sample of Brazilian households, we specify and estimate a structural model of appliance choice and document that (i) the program only increases the valuations of households facing incentives in the form of an energy consumption quota introduced by the program; (ii) the effect of incentives dominates other components of the energy efficiency gap; (iii) the effect of the program on valuations is temporary, with these essentially reverting to prior levels after the end of the program; (iv) heterogeneity in valuations is prevalent; (v) focusing only on the purchase of new refrigerators, the counterfactual en-
ergy savings are non-trivial, being equivalent to the yearly electricity consumption of a city with 1.15 mn inhabitants. The findings suggest that short-lived reactions to temporary programs on the extensive margin are non-trivial and have log-run implications via the purchase of durables.
-- paper

(2020): Consumer Response to Energy Label Policies: Evidence from the Brazilian Energy Label Program
with Claudio Lucinda and André Ribeiro
Energy Policy
-- paper

(2018): Fuel Choice and Fuel Demand Elasticities in Markets with Flex-fuel Vehicles
Nature Energy
-- paper

(2017): Bailing Out on the Car That Wasn't Bailed Out: Explaining Consumer Reactions to Financial Distress
with Nikita Koptyug
Journal of Economics and Management Strategy 26, 337-374.
-- paper

(2014): The Market Impact and the Cost of Environmental Policy: Evidence from the Swedish "Green Car" Rebate
with Claudio Lucinda
Economic Journal 124, F393-419 (lead article)
--Winner of the Haralambos Simeonidis Prize for the best paper published by a Brazilian economist in the previous 2 years
-- paper

(2013): Build It, But Will They Come? Evidence from Consumer Choice Between Gasoline and Sugarcane Ethanol
with Alberto Salvo

Journal of Environmental Economics and Management 66, 251-279.
-- paper  slides

(2012): Does Product Differentiation Soften Price Reactions to Entry? Evidence from the Airline Industry
with Alessandro V. M. Oliveira
Journal of Transport Economics and Policy 46 (2), 189-204.

  (2011): Is Arbitrage Tying the Price of Ethanol to that of Gasoline? Evidence of the Uptake of Flexible-Fuel Technology
with Alberto Salvo

Energy Journal 32 (3), 119-148.
-- paper  online appendix

   (2011): Term Structure Modelling with Observable State Variables
Journal of Banking and Finance 35 (12) 3240-3252.

(2009): Localized competitive advantage and price reactions to entry: Full-service vs. low-cost airlines in recently liberalized emerging markets
with Alessandro V. M. Oliveira
Transportation Research E: Logistics and Transportation Review, Vol 45 (2), 307-320.
  (2007): Investigating Business Traveller Heterogeneity: Low-Cost vs Full-Service Airline Users ?
with Fabio Evangelho
Transportation Research E: Logistics and Transportation Review, Vol 43 (3), 259-268.

(2005): Market Entry of a Low-Cost Airline and Impacts on the Brazilian Business Travellers
with Fabio Evangelho and Alexandre Linhares
Journal of Air Transport Management Volume 11 (2), 99-105.

Book Chapters  
  Estimation and Identification of Demand and Supply
with Alberto Salvo, in Portuguese

In: Quantitative Methods Applied to Antitrust and Regulation, edited by Eduardo P. S. Fiuza and Ronaldo Seroa da Motta (Instituto de Pesquisa Econômica Aplicada, IPEA).
Brasília: SDE (Ministry of Justice), 2006.

(c) Cristian Huse 2008-2021