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Accelerator or Brake? Cash for Clunkers, Household Liquidity, and Aggregate Demand / Daniel Green, Brian T. Melzer, Jonathan A. Parker, Arcenis Rojas.
- Format:
- Book
- Author/Creator:
- Green, Daniel.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w22878.
- NBER working paper series no. w22878
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2016.
- Summary:
- We evaluate the Car Allowance Rebate System (CARS) by comparing the vehicle purchases and disposals of households with eligible "clunkers" to those of households with similar, but ineligible, vehicles. We find that CARS caused roughly 500,000 purchases during the program period and that the liquidity provided by CARS was critical for generating this large response. CARS provided less liquidity for households owning clunkers securing loans, since participation required loan repayment. The participation rate of these households was low, which we attribute to liquidity constraints and distinguish from the effects of other indebtedness, household income, and the size of the program subsidy.
- Notes:
- December 2016.
- Print version record
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