Comments by People in the News

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Cars.com

MPG Can=20 Mislead When Searching for Fuel = Efficiency
New York = Times, United=20 States - Jun 23,=20 2008
By HENRY = FOUNTAIN In=20 an era of climate change and expensive gasoline, a = vehicle=E2=80=99s=20 fuel efficiency, measured in miles per gallon, is an=20 increasingly ...
MPG=20 Calculations Cause Confusion Wall Street Journal=20 Blogs
= Gas-Saving=20 Moment of the Day: Measure in Gallons Per Mile = Cars.com
Crosscut -=20 ScienceBlogs
<= B>all=20 6 news=20 = articles =C2=BB

Comment by Richard = Larrick=20 & Jack Soll, Fuqua School of Business, = Duke=20 University

Understanding The MPG=20 Illusion - Jun 24,=20 2008

Cars that have higher MPG are=20 always more efficient than cars that have lower MPG. =20 We encourage people to buy the most efficient car = available=20 and to drive fewer miles. However, people are = currently=20 driving inefficient cars and face constraints on = replacing=20 their cars. Families must decide which car to=20 replace: The minivan or the sedan. Drivers = of SUVs=20 need to decide is it worth it to replace an SUV with a = minivan? Although higher MPG is=20 always better than lower MPG in=20 saving gas over a given distance, it is a misleading = scale=20 when judging the amount of gas saved with an MPG=20 improvement. And it leads people to undervalue small = MPG=20 improvements on inefficient cars. For additional = information,=20 including links to a quiz, video, tables, and = calculators, see=20 the following website:

http://mpgillusion.blogspot.com= /

A=20 Family Decision

For example, if a 2-car = family has=20 a minivan that gets 18 MPG and=20 sedan that gets 34 MPG,=20 and both are driven the same distance per year, will = more gas=20 be saved by replacing the minivan with a small station = wagon=20 that gets 28 MPG, or=20 by replacing the sedan with compact hybrid that gets = 50 MPG? =20 Many people judge efficiency by linear improvement in = MPG=E2=80=94in=20 that case, the 17 MPG=20 improvement from sedan to compact looks impressive. = The 10=20 MPG=20 improvement from minivan to station wagon looks less=20 impressive. However, one has to calculate gas = consumed=20 to get the right answer. The formula for = calculating=20 this is distance divided by MPG. =20 The graph at this link shows this figure for driving = 10,000=20 miles:

http://faculty.fuqua.duke.edu/~larrick/bio/Reshighlights.htm#GPMgraph

Trading= =20 in a car that gets 18 MPG for=20 one that gets 28 MPG=20 saves 198 gallons (555 gallons per 10,000 miles = reduced to 357=20 gallons per 10,000 miles). Trading in a car that gets = 34 MPG for=20 a car that gets 50 MPG=20 saves 94 gallons over the same distance (294 gallons = per=20 10,000 miles reduced to 200 gallons per 10,000 = miles). =20

Calculating Gas Savings from Improving = MPG

Certainly=20 trading in an efficient car that gets 34 MPG for=20 one that gets 50 MPG=20 looks great. By contrast, many trade ins for = small=20 improvements don=E2=80=99t seem worthwhile. Why = bother trading=20 in a 16 MPG car=20 for 20 MPG? =20 Or, why bother putting hybrids on extremely large = vehicles,=20 increasing their MPG=20 from 12 to 14? The table below takes the numbers = in the=20 graph and shows that each of those improvements is = equally=20 beneficial in reducing gas use. They all save = about 100=20 gallons over 10,000 miles (with a little = rounding). =20 Without question, 50 MPG is=20 the most efficient level and ideally everyone would = strive for=20 it. But, if we are simply considering changes to = existing vehicles, 16 to 20 MPG can=20 help save as much gas as 33 to 50 MPG. =20 The table below shows all the improvements in MPG=20 that result in saving 100 gallons of gas. = (Note: =20 the MPG=20 figures have been rounded to the nearest = .5)

10.0 MPG   =20 =3D 1,000 gallons per 10,000 miles driven
11.0 = MPG   =20 =3D 900 gallons per 10,000 miles driven
12.5 MPG   =20 =3D 800 gallons per 10,000 miles driven
14.0 MPG   =20 =3D 700 gallons per 10,000 miles driven
16.5 MPG   =20 =3D 600 gallons per 10,000 miles driven
20.0 MPG   =20 =3D 500 gallons per 10,000 miles driven
25.0 MPG   =20 =3D 400 gallons per 10,000 miles driven
33.0 MPG   =20 =3D 300 gallons per 10,000 miles driven
50.0 MPG   =20 =3D 200 gallons per 10,000 miles driven

These = numbers=20 appear in Table 2 of this pdf file:

http://www.fuqua.du= ke.edu/news/mpg/table.pdf

The=20 Research

Our paper published in Science = (Larrick,=20 R. P., & Soll, J. B. (2008). The MPG=20 illusion. Science, 320, 1593-1594) looked at = people=E2=80=99s=20 intuitions about car fuel efficiency when expressed as = miles=20 per gallon (MPG),=20 which is the common measure used in the United = States. =20 We showed in two studies that people reasoned in an = incorrect=20 way about the amount of gas saved by replacing = vehicles that=20 differ in MPG. =20 Most people ignore the fundamental curvilinearity = shown above=20 and incorrectly reason that fuel consumption decreases = as a=20 linear function of MPG. =20 One consequence of linear reasoning is that people = undervalue=20 replacing currently inefficient cars with new cars = that add 5=20 or 10 MPG. =20 (As we describe below, thinking in terms of percentage = improvement in MPG=20 doesn=E2=80=99t get it right, either.) A third = study showed that=20 converting units to GPM helped people identify the = most fuel=20 efficient changes in vehicles.

Links to the = original=20 published research:
http://dx.doi.org/10.1= 126/science.1154983
http:/= /www.sciencemag.org/cgi/content/short/320/5883/1593
http://www.sciencemag.org/cgi/content/full/sci;320/5883/1593/DC1
=

Gallons=20 per 10,000 Miles (GPM)

The MPG=20 illusion is corrected, however, when people think in = terms of=20 gallons per mile (GPM) for some standard (meaningful)=20 distance. Many countries express efficiency as = liter per=20 100 kilometers. For the U.S., we would propose = gallons=20 per 10,000 miles. Here=E2=80=99s an abbreviated table = of what GPM=20 numbers would look like for 10 MPG=20 levels that differ by 5 MPG:

10=20 MPG   =20 =3D 1,000 gallons per 10,000 miles driven
15 MPG   =20 =3D 667 gallons per 10,000 miles driven
20 MPG   =20 =3D 500 gallons per 10,000 miles driven
25 MPG   =20 =3D 400 gallons per 10,000 miles driven
30 MPG   =20 =3D 333 gallons per 10,000 miles driven
35 MPG   =20 =3D 286 gallons per 10,000 miles driven
40 MPG   =20 =3D 250 gallons per 10,000 miles driven
45 MPG   =20 =3D 222 gallons per 10,000 miles driven
50 MPG   =20 =3D 200 gallons per 10,000 miles = driven

These numbers=20 appear in Table 1 of this pdf file:

http://www.fuqu= a.duke.edu/news/mpg/table.pdf

GPM=20 makes clear the large savings available by replacing=20 inefficient cars in the 10 to 20 MPG=20 range. 10,000 miles not only makes the = difference look=20 large, it is close to the national average for yearly=20 driving. It=E2=80=99s a realistic estimate of = fuel consumption=20 for many. And, because the number is round, it = is pretty=20 easy to adjust up or down for actual driving. = The=20 perfect GPM expression, however, would be to a = personal=20 distance. We=E2=80=99ve created an excel = worksheet like this=20 that is available on the www.mpgillusion.blogspot.com=20 website.

We prefer gas in the numerator, = rather=20 than cost, because gas prices can change substantially = in a=20 short period of time. Also, a direct measure of gas=20 consumption is just one step away from calculating = greenhouse=20 gas emissions from burning gas (one gallon equal a = little over=20 20 pounds of carbon dioxide). GPM is valuable = because it=20 is easily converted to cost as gas prices change by=20 multiplying GPM by the price of gas per gallon. =20

The Policy Implications

There = are two=20 policy implications.

First, it would be = useful=20 to car buyers to have gallons per 10,000 miles readily = available with descriptions of cars (such as in = consumer=20 magazines, car sites, and environmental = sites).

Second,=20 GPM shows that replacing the most inefficient = vehicles, and=20 improving their MPG by=20 a seemingly small amount, can make a big difference in = gas=20 consumption. In fact, it can make a larger = difference=20 than replacing efficient vehicles with cars that get = 50 MPG.

Possible=20 Misconceptions about GPM

A few = misconceptions have=20 come up when people have reacted to this=20 proposal:

1) MPG vs.=20 GPM. We are not proposing to replace MPG,=20 just to supplement it. MPG is=20 very useful once you own a car and need to know the = range of=20 the gas tank. However, GPM is more useful when = deciding about=20 replacing a car or choosing between two cars. = Both=20 measures are useful at different points in = time.

Note=20 that both measures serve equally well to tell you what = is more=20 efficient: 50 MPG is=20 better than 20 MPG;=20 200 gallons per 10,000 miles is better than 500 = gallons per=20 10,000 miles.

We would argue that GPM is better = than=20 MPG at=20 helping people see the outcomes of their car = decisions: =20 It spells out in clear numbers how much gas = they=E2=80=99re going to=20 use. 1,000 gallons per 10,000 miles is clearly=20 dreadful. 200 gallons per 10,000 is clearly = great. =20 You can immediately tell how much a car will cost over = 10,000=20 miles to fuel. And you can see the value of = choosing the=20 more efficient car over the less efficient car. None = of this=20 is transparent with MPG=20 until you do more math.

2) Imperial = vs.=20 Metric. The metric system does not solve the = MPG=20 illusion. India uses kilometer and liters but = expresses=20 efficiency as kilometers per liter. Because the = ratio is=20 distance over volume, it creates a parallel illusion = to MPG. =20 See this blog for a nice translation to the Indian=20 context:

http://www.livemint.com/2008/06/19222458/Efficiency-measure-= gives-wrong.html

Many=20 countries currently use liters per 100 kilometers, = which has=20 the right numerator (volume) and denominator = (distance) for=20 judging efficiency gains. However, some people = living in=20 those countries have questioned how helpful it has = been. =20 We think that the base distance should be larger so = that=20 differences between efficiency levels are clearer and = involve=20 fewer decimal places.

3) Linear = vs.=20 Percentage reasoning. Percentage increase in = MPG,=20 like linear increase in MPG,=20 does not solve the MPG=20 illusion. Many people look at a 50% MPG=20 improvement, such as 33 to 50 MPG,=20 and assume that it will save more gas than a 30% MPG=20 improvement from 10 to 13 MPG=20 over the same distance. A quick check of the = math will=20 show that 10 to 13 saves 230 gallons over 10,000 = miles; 33 to=20 50 MPG=20 saves only 100 gallons over the same distance. =20 Percentage increase in MPG,=20 like linear increases, is a fallible indicator of = improvements=20 in efficiency. The problem with percentage reasoning = is that=20 the percentage change has to be applied to an initial = level of=20 gas that is being=20 consumed.

Disclaimer: The = views=20 expressed herein are those of the author and do not=20 necessarily reflect the views of Google Inc. or its = employees.=20 More information he= re.

=C2=A92008 Google -=20 About=20 Google News - Blog -=20 Help Center - = Help for = Publishers -=20 Terms=20 of Use - Google Home<= /FONT>

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