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Although the federal gasoline tax played multiple roles in financing surface transportation infrastructure in the United States, experts did not agree on the tax's purpose. Some argued that it was essentially a fee for users of the nation's federally supported highways. Others suggested that it should play a more prominent role in environmental, energy, and transportation policy by correcting for driving-related externalities. Still others suggested that it should be used to reduce the federal budget deficit. Finally, the tax itself had remained at the same level since 1993, and with the Highway Trust Fund virtually insolvent, many experts believed it was time for an increase. The case presents a background on the U.S. federal gasoline tax, an overview of the market for gasoline in the United States, and survey of gasoline taxes in U.S. states as well as several other countries around the world.

The case can be used to discuss the incidence of the gasoline tax, as well as its role as a Pigouvian tax to deal with negative externalities related to gasoline consumption and driving. There is sufficient data in the case to enable students to analyze the incidence of the federal gasoline tax and to determine the socially efficient level of the tax in light of externalities related to gasoline consumption and driving.

Motivated by the news media and a lack of comprehensive research on the USA, the purpose of this paper is to examine the relationship between changes in road fatalities and gasoline prices, per capita disposable personal income, alcohol consumption per adult, blood alcohol concentration (BAC) limits and gender.

This study employs both static and dynamic panel data models, making use of annual data over the 2000–2013 period collected from the 50 states of the USA and the consistent system GMM estimators of the parameters, to estimate the impact of these variables on fatalities per 100,000 persons and per 100,000 vehicles.

The results highlight the importance of gasoline prices in determining the level of road fatalities, underscoring that a 10 percent decrease in gasoline prices leads to a 248 increase in the total number of road fatalities, but with many more injuries. Increases in the female-to-total driver ratio have a greater significant positive impact on road fatalities where a 10 percent increase in this ratio increases road fatalities by 1,008 deaths. Increases in registered vehicles per capita also increase the number of fatalities. Other variables such as alcohol consumption per adult and BAC limits are not as important. Policy implications are also provided.

The results of this study highlight the importance of gasoline prices in determining the number of road fatalities. This factor can be an effective policy measure by which policymakers can offset increases in fatalities due to further drastic declines in future gasoline prices. But the effects of the gasoline prices in determining the number of road fatalities are not as strong as the media would lead us to believe. The media ignores the impact of other factors on fatalities, which results in an overestimation of the impact of gasoline prices.

This study uses the panel data of 50 US states and the dynamic panel data model. In addition to gasoline price effects on the road fatalities, this study also considers other factors such as gender, gasoline taxes, per capita disposable personal income, per capita alcohol consumption, BAC limits and number of registered vehicles.

The purpose of this paper is to explore automobile fuel efficiency policies in the presence of two externalities: a global environmental problem and international innovation spillovers.

Using a simple model with two regions, the authors show that both a fuel tax and a tax on vehicles based on their fuel economy rating are needed to decentralize the first best.

If standards are used instead of taxes, the authors find that spillovers may alleviate free-riding. Under some conditions, a strict standard in one region may favor the adoption of a strict standard in the other one.

The authors also show that if policies are not coordinated between regions, the resulting gas taxes will be set too low and each region will use the tax on fuel rating to reduce the damage caused by foreign drivers.

Fiscal stress has forced local governments to pay increasing attention to revenue trends and has increased the importance of financial forecasting in local government. After reviewing the role of revenue forecasting in financial planning and discussing the use of regression and econometric analysis in revenue forecasting, this article applies this technique to forecast several key revenue components in a medium-sized city. Three general conclusions may be drawn: (1) systematic revenue forecasting and long-range planning are necessities, not luxuries, (2) risk aversion to "technical" revenue forecasting can be overcome, and (3) the implementation of a systematic revenue forecasting system does not require a battery of "rocket scientists." As municipal revenue bases come to rely less on relatively stable property taxes and more on less stable sources such as sales taxes, fees, and charges, the use of a regression and econometric based model should prove increasingly fruitful.

To explore the relationships among oil import dependence, energy (in)efficiency, and environmental damage for the USA. The goal is to illuminate possibilities for reducing oil import dependence.

The paper uses current information about costs of oil imports and energy alternatives for transportation vehicles, and environmental concerns, along with information about alternatives for energy provision for this purpose, to demonstrate feasible ways to reduce dependence, including government policy steps.

The USA is dependent on imported oil: two‐thirds of US oil used today is imported, and mostly used as gasoline for autos – close to 70 percent of all oil is used in transportation. This greatly affects the US BOP; oil imports cost almost US$300 billion in 2006. Current energy efficiency of auto engines is about 15 percent. Using hydrogen fuel cells would at least double this value, as well as reducing waste and completely eliminating carbon dioxide emissions. An efficient means of producing the hydrogen must be developed. A related problem is damage to the environment caused by greenhouse gas emissions. This problem also can be attacked by increasing engine efficiency, and ultimately by replacing gasoline in auto engines with alternative fuels such as hydrogen in fuel cells, as well as by reducing auto use, via mass transport. Policy alternatives include: encouraging energy efficiency via new technologies for vehicle engines; encouraging mass transportation; and higher production of fuels in the USA. Reducing demand via taxes, as in Europe, could reduce consumption, but at a cost to overall GDP unless alternative fuels become competitively priced.

The two main limitations on our recommendations are technology for making fuel cells more competitive, and willingness of government to take the needed policy steps. The practical implication is that dependence can be reduced with these steps.

The paper links the three corners of the energy triangle: dependence; efficiency, and environment.

This is the second set of lecture notes from courses in public finance published in an archival volume in this series. Volume 19-C (2001) was entirely devoted to notes from lectures by E. R. A. Seligman at Columbia University. Two differences mark Seligman’s lectures and the lectures by Henry C. Simons at Chicago, as reported below. Seligman seems to have been lecturing primarily to students in tax administration, hence he presented very little economic theory; whereas Simons was lecturing to graduate students in economics, and presented relatively more theory. Seligman did not refrain from some passing of judgment but his lectures were largely descriptive and non-judgmental; whereas Simons has no hesitation in presenting his own normative approach on various issues. These issues tended strongly to focus on inequality, tax justice, and progressivity.