Replication data for: The Welfare Effects of Misperceived Product Costs: Data and Calibrations from the Automobile Market

Principal Investigator(s):  View help for Principal Investigator(s) Hunt Allcott

Version:  View help for Version V1

Name File Type Size Last Modified
  Allcott-VOAS-Replication-Code 10/13/2019 07:40:AM
LICENSE.txt text/plain 14.6 KB 10/13/2019 03:40:AM

Project Citation: 

Allcott, Hunt. Replication data for: The Welfare Effects of Misperceived Product Costs: Data and Calibrations from the Automobile Market. Nashville, TN: American Economic Association [publisher], 2013. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-13. https://doi.org/10.3886/E114833V1

Project Description

Summary:  View help for Summary This analysis exploits new data from the Vehicle Ownership and Alternatives Survey, which elicits beliefs over the financial benefits of owning higher fuel economy vehicles. The data are used to test for underestimation and to document evidence of "MPG Illusion": consumers think as if fuel costs scale linearly in miles per gallon instead of gallons per mile. Counterfactuals suggest that the MPG Illusion reduces welfare by less than $4 per new vehicle. Furthermore, even the most severe plausible underestimation of the financial benefits of fuel economy cannot account for the consumer welfare gains attributed to fuel economy standards.

Scope of Project

JEL Classification:  View help for JEL Classification
      D12 Consumer Economics: Empirical Analysis
      D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
      L62 Automobiles; Other Transportation Equipment; Related Parts and Equipment


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V1 [2019-10-13]

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