Department of unintended consequences, gas-guzzler edition

It is always worth scrutinising any government policies for unintended consequences. (I suspect that even politicians do this, but rarely care as long as the headlines sound good.) Alistair Darling’s do-nothing budget will have few consequences, positive or negative.

But I did spot one: the “showroom tax” on less efficient new cars is designed to raise cash and make Darling look green, and it may achieve those aims. But is it good for the planet? That depends on whether it persuades people to buy smaller, more efficient new cars, or whether it persuades people to drive their old, heavily-polluting gas guzzlers around for longer than they otherwise would have done. I have no idea which effect with predominate, and I suspect that Mr Darling doesn’t either.

A tax on a specific type of vehicle is, incidentally, gesture politics. Big cars don’t hurt the planet unless they are driven around; when they are driven around, their drivers pay a high duty on fuel. Trying to reduce emissions by targeting the type of car is a clumsy, round-about way to achieve a sensible goal.

Tim Harford’s blog

This blog is no longer updated but it remains open as an archive.

Tim, also known as the Undercover Economist, writes about the economics of everyday life.

The Undercover Economist: a guide

Publishing schedule: Excerpts from "The Undercover Economist" and "Dear Economist", Tim's weekly columns for the FT Magazine, are published on this blog on Saturday mornings.
More about Tim: Tim also writes editorials for the FT, presents Radio 4's More or Less and is the author of "The Undercover Economist" and "The Logic of Life".
Comment: To comment, please register with FT.com, which you can do for free here. Please also read our comments policy here.
Contact: Tim's contact address is: economist@ft.com
Time: UK time is shown on posts.
Follow: A link to the blog's RSS feeds is at the top of the page.
Follow on Twitter
FT blogs: See the full range of the FT's blogs here.