Cash for Clunkers: An Evaluation

According to a new paper and policy brief by Ted Gayer and Emily Parker, the Car Allowance Rebate System (CARS) or "cash for clunkers" program, launched during the height of the recession with the intention of stimulating the economy, creating jobs, and reducing emissions, was actually far more expensive per job created than alternative fiscal stimulus programs.



Graphics by Christopher Ingraham

Sources: Trade-in, rebate, and money spent figures from the U.S. Government Accountability Office. Vehicle type, manufacturer shares, and state voucher amounts from the National Highway Traffic Safety Administration. Vehicle sales trends from the Bureau of Economic Analysis/Haver Analytics. Costs per job created from the Congressional Budget Office. See full report for more details.

SUMMARY

According to a new paper by Ted Gayer and Emily Parker, the Car Allowance Rebate System (CARS) or "cash for clunkers" program, launched during the height of the recession with the intention of stimulating the economy, creating jobs, and reducing emissions, was actually far more expensive per job created than alternative fiscal stimulus programs.