Lucas W. Davis

About Lucas W. Davis (Edit profile)

Lucas W. Davis is Associate Professor in the Haas School of Business at UC Berkeley (ldavis@haas.berkeley.edu) and a Research Fellow at the National Bureau of Economic Research (NBER).

Cash for Clunkers? The Environmental Impact of Mexico’s Demand for Used Vehicles

Lucas W. Davis and Matthew E. Khan

Over the last two decades private vehicle ownership in the developing world has increased at an unprecedented pace. Between 1990 and 2005 the total number of registered vehicles in developing countries rose from 110 million to 210 million, and by some estimates it is forecast to reach 1.2 billion by 2030. Rising incomes explain a large share of this growth; as people get richer, they can afford the personal mobility that an automobile confers. Some of this demand for automobiles is satisfied when people in poor countries buy new vehicles. But another important, yet rarely discussed, factor is international trade in used vehicles. High-income countries export large numbers of used vehicles to low-income countries, and this trade will probably grow.

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