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Dargay, 2007 - Vehicle Ownership
Dargay, 2007 - Vehicle Ownership
Dargay, 2007 - Vehicle Ownership
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1. INTRODUCTION
TheEnergy Vol.28,No.4.Copyright
Journal, ©2007
bytheIAEE.Allrights
reserved.
* forTransport
Institute Studies, of Leeds,LeedsLS2 9JT,England.
University E-mail:
j.m.dargay@its.leeds.ac.uk.
** Corresponding
author.
Dept.ofEconomics,
NewYork 19W.4 St.,NewYork,
University, NY
10012
USA.E-mail:
Dermot.Gately@NYU.edu.
*** International
Monetary Fund,700 19thSt. NW,Washington,DC 20431USA.E-mail:
Theopinions
MSommer@imf.org. inthispaper
expressed arethose
oftheauthors
andshould
notbeattributed
totheInternational
Monetary itsExecutive
Fund, oritsmanagement.
Board,
143
1.AllOECDcountries
areincluded,
excepting andtheSlovak
Portugal Republic. was
Portugal
excluded
because
wecouldnotgetvehicles
datathat
excluded
2-wheeled andtheSlovak
vehicles,
because
Republic comparabledatawereunavailable
fora sufficiently
longperiod.Amongthe
non-OECDcountries
with data,weexcluded
comparable andHongKongbecause
Singapore their
population wastentimes
density than
greater anyoftheother andweexcluded
countries, Colombia
because
ofimplausible
25%annualreductions
invehicle in1994and1997.
registrations
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3. THE MODEL
As illustrated
above,we represent
therelationship betweenvehicleown-
ershipandper-capita incomebyan S-shapedcurve.Thisimpliesthatvehicleown-
ershipincreasesslowlyat thelowestincomelevels,and thenmorerapidlyas in-
comerises,andfinally slowsdownas saturation is approached.
Therearea number
of different
functional formsthatcan describesucha process - forexample,the
logarithmic
logistic, cumulative
logistic, normal, andGompertz functions.
Follow-
ingourearlierstudies,theGompertz modelwas chosenfortheempirical analysis,
becauseitis relatively
easytoestimateandis moreflexible thanthelogisticmodel,
byallowingdifferent
particularly curvatures
at low-andhigh-income levels.2
LettingV* denotethelong-run equilibrium levelof vehicleownership
(vehiclesper1000people),andletting GDP denoteper-capita income(expressed
inreal 1995dollarsevaluatedat PurchasingPowerParities),theGompertz model
can be written as:
'
r = (i)
whereyis thesaturation
level(measuredinvehiclesper1000people)anda andp
arenegativeparametersdefining ofthefunction.
theshape,orcurvature,
The impliedlong-run of thevehicle/population
elasticity ratiowithre-
specttoper-capita
incomeis notconstant,
duetothenatureofthefunctional form,
butinsteadvarieswithincome.The long-run is calculatedas:
incomeelasticity
2.SeeDargay-Gately
(1999)for
a simpler
model, a smaller
using setofcountries.
Earlier
analyses
aresummarized
inMogridge which
(1983), discusses
vehicle
ownership modelled
being byvarious
functions
S-shaped oftime,
rather
thanofper-capita
income,some
with saturation
andsomewithout.
MedlockandSoligo a log-quadratic
(2002)employ ofper-capita
function income.
$GDPt
'
y^R= ccpGDPte (2)
y= o)
°*PGDPt
+ (1 - 0)V ,
Vt= yde (4)
3. Asdiscussed there
below, canbe differences
across
countries
inthesaturation
levelsofa
country's function
Gompertz anditsincome
elasticity. 3 plots
Figure anillustrative
functionforthe
median saturation
country's level.
Differences
across
countries inFigure
areillustrated 6.
4. Population andurbanization
density arenormalised thedeviations
bytaking fromtheir
means
overallcountries
andyearsinthedatasample.
Sincepopulation andurbanization
density varyover
sotoodoesthesaturation
time, level.
y„=yMAx+XD„+vv„
where
D it=D it-D„„, if D it>Dn„.
USA,t USA.t
= 0 otherwise (5)
and
U.=U.~
it it U.„A , if £/,
USA.t it> U„,A
,
USA.t
= 0 otherwise
Can
Aus
1 1 1 1 1
0 20 40 60 80 100
2002
% Urbanized,
e= + (7)
+ ('-QRRi-QFFJVii_l+ eii
4. MODEL ESTIMATION
Twn
500 1 1 1 ^
4 6 8 10 12
income
per-capita 1995
(thousands $ PPP)
atwhich
vehicle =200inlong
ownership run
10.Population is assumed
density togrowat thesamerateas population. for
Projections
areobtained
urbanization byestimatinga modelrelating toper-capita
urbanization income andlagged
urbanization over
forallcountries thesampleperiod forecasts
andcreating onthebasisofthismodel
andtheprojected income
per-capita Themodel
values. usedandtheestimates areavailable
obtained
uponrequest.
11. Forthe"Other"(non-sample)countries weprojected
oftheworld,
intherest vehicle
ownership
fromourestimated Gompertzfunction's tothis"Other"
adapted
parameters, characteristics.
group's
In2002this group income
hadper-capita ofabout$3000andowned 44vehicles per1000people.We
estimatedthegroup'scoefficient thesample
byregressing (3.values
countries' against of
thelevels
income
per-capita atwhich
therespective per1000people;
had44vehicles
countries thisproduceda
valueofp.=-0.21 for"Other"countries.
Using thesample median
countries' value(812),
saturation
weassumed 1.7%annual income
per-capita growthfor"Other"
countries,andprojected vehicle
their
ownership to2030.
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12.Asobservedintheprevious China's
section, estimated levelforvehicle
saturation ownership
(807)ishigher
than
that forIndia(683).ThisisbecauseChina's density
population isonlyone-third
ofIndia's,
giventhefactthatwedivide population than
bylandarearather habitable
landarea(90%
ofChina's livesinonly30%ofthelandarea).IfweusedIndia's
population lower level
saturation
forChina, forChinain2030would
ourprojections bevehicle of228rather
ownership than 269
vehicles
per1000people,and331million total
vehicles
rather
than 390million.
Thiswould represent
a reduction
intheannualgrowthrate ofvehicle from
ownership 10.6%to10.0%;theratio
togrowth
inper-capita
incomewould be2.07rather than2.2.
Projectionsof increasingvehicleownershipsuggestthathighwayfuel
However,therateofincreaseinhighwayfuel
use mayalso increasesignificantly.
16.Theratio
ofgasoline tototal
consumption vehicles measure
isanimperfect ofhighway fueluse
because
pervehicle, somevehicles
usediesel
fuel
instead andsome
ofgasoline, gasolineisnotusedby
vehicles.
Weuseonly gasoline because
consumption wehavenodatafordieselfuelconsumptionfor
non-OECD orfor
countries, OECDcountriesbefore
1993.Somerecent inGerman
reductions gasoline
usagereflect todiesel
fuel-switching andinBrazil theuseofethanol.
reflect
17.OPEC(2004)projectsthefollowingannualrates forhighway
ofdecline fuelpervehicle:
OECDNorth America:
-0.5%,OECDEurope: -0.6%,OECDPacific:-0.4%,China:-2.1%,Southeast
Asia:-0.9%,SouthAsia:-2.2%,LatinAmerica:-0.7%,AfricaandMiddle East:-1.4%.Weuse
estimates
ofthese
regions'
highwayfuel
pervehiclefromBrennand(2006)tocalculate
highwayfuel
consumptionin2002.
7. CONCLUSIONS
ACKNOWLEDGEMENTS
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