Information for 8137IIED
Automobile Pollution Control in Brazil
Air pollution concentrations have been rapidly increasing in the major urban areas of Brazil caused mainly by the increasing use of vehicles. Policies to control car emissions in Brazil have relied basically on mandatory emission standards and subsidies for specific cleaner technology resulting in substantial decrease of car emission rates. Nevertheless, taxes on car sales, differentiated by vehicles’ size and fuel, have also influenced car emission patterns. This paper analyses the compliance trend of the Brazilian fleet with environmental standards between 1992 and 1997. We find that larger automobiles had the fastest compliance schedule while popular models adjusted very slowly. Also gasoline-fuelled models had a faster adjustment pattern than ethanol cars. Additionally, we analyse the current relationship between pollution emissions and car characteristics in order to orient policy formulation. We find a positive relationship between emissions rates and horse power, concluding that although the current value-added sale car tax is not environmentally harmful, a tax differentiating clean from dirty models, within each tax bracket, could create substantial incentives for emission control in the future.