YSE's Kenneth Gillingham and a team of economists find that the EPA has used inconsistent assumptions to justify both tightening and loosening vehicle emissions rules — assumptions that determine whether the rules' benefits outweigh their costs.

That’s the finding of a new analysis in Science co-authored by Kenneth Gillingham, the Grinstein Class of 1954 Professor of Environmental and Energy Economics at the Yale School of the Environment, along with nine other economists from institutions across the country. When the Trump administration rescinded the EPA’s greenhouse gas standards for vehicles this spring, it backed the move with the cost-benefit analysis that is required of any economically significant federal rule. It concluded that Americans would be $600 billion to $790 billion better off without the standards. Gillingham and his co-authors show that correcting just one of the analysis’s assumptions is enough to turn that benefit into a net cost.

“My co-authors and I have been carefully following the regulations affecting vehicle efficiency and fuel type, and we observed enormous swings in the analysis between administrations,” Gillingham said. “If the numbers are being calculated correctly, one or both of the analyses must be incorrect.”

The authors argue that ascribing a zero value for avoided air pollution, as in the latest Trump administration rulemaking, is obviously incorrect, but the assumption about the valuation of vehicle efficiency is more nuanced.