Travel Distance and Fuel Efficiency: An Estimation of the Rebound Effect using Micro-Data in Switzerland

We estimate the rebound effect for private transportation using cross-section micro-level data in Switzerland for 2010. Our simultaneous equations model accounts for endogeneity of travel distance, vehicle fuel intensity and vehicle weight. Compared to the literature, our paper provides an important contribution as micro-level data and simultaneous equations models have seldom been used to estimate the rebound effect. Moreover, among the distance measures we use, one is highly reliable as it was recorded using GIS (Geographical Information System) software. Our results, obtained by 3SLS, point to substantial direct rebound effects between 75% and 81%, which lie at the higher end of the estimates found in the literature. OLS estimates are however much lower and seem to under-estimate the rebound effect.