ESTIMATING AN EMISSIONS SUPPLY FUNCTION FROM ACCELERATED VEHICLE RETIREMENT PROGRAMS

Local authorities and industries seeking to reduce emissions and impro ve air quality have shown interest in programs that offer to purchase and retire old, high-polluting vehicles. We analyze the results from a n experimental vehicle retirement program in Delaware, during which se lected pre-1980 vehicle owners were offered $500 for their vehicles an d surveyed about vehicle characteristics, value and use. With this uni que data set we estimate the relationship between the owner's reservat ion price and the expected remaining life of the vehicle to derive a s upply curve for emissions reductions, which predicts the emissions red uctions as a function of the offer made to eligible vehicles in a scra ppage program.