The Trump administration used selective assumptions, inconsistent interpretations of evidence, and accounting errors to justify eliminating federal greenhouse gas standards for vehicles, according to a new study published in Science and co-authored by an environmental economist at the USC Price School of Public Policy.
Correcting three major problems in the Environmental Protection Agency’s 2026 analysis would reduce the estimated economic benefits of rescinding the standards by nearly $1.5 trillion, the researchers concluded. Those corrections alone would overturn the Trump administration’s economic justification for the rollback—even without considering the environmental and public-health benefits of reducing pollution.
“The Trump Administration eliminated the U.S. Environmental Protection Agency greenhouse gas standards for vehicles because they said it would save consumers money. It won’t,” said Antonio Bento, a Professor of Public Policy and Economics at the USC Price School and one of the co-authors. “That’s because the administration’s claim was based on a deeply flawed analysis that relied on selective assumptions and inconsistent interpretations of key evidence.”
The study, “Correcting the logic behind the 2026 U.S. vehicle emissions standard rollback,” was published Aug. 27 in Science. In addition to Bento, its authors are Kenneth T. Gillingham, Mark R. Jacobsen, Christopher R. Knittel, Benjamin Leard, Joshua Linn, David S. Rapson, James M. Sallee, Arthur A. van Benthem and Kate S. Whitefoot. (See a list of author affiliations at the end of this document.)
Although dramatic shifts in vehicle regulations under recent presidential administrations have all claimed support from formal cost-benefit analyses required by executive orders, the researchers found that their conflicting conclusions do not reflect changes in scientific or economic evidence. Instead, the analyses have treated the same evidence differently depending on the administration conducting them.
Vehicle emissions and fuel economy standards have changed repeatedly over the past two decades. The George W. Bush administration modestly strengthened them, the Barack Obama administration accelerated them, the first Donald Trump administration partially rolled them back, and the Joe Biden administration reinstated and tightened them.
The second Trump administration went further, eliminating EPA greenhouse gas standards for vehicles in April 2026. It also eliminated penalties associated with Department of Transportation fuel economy regulations and proposed standards that the researchers said are unlikely to meaningfully constrain automakers.
The EPA’s 2026 analysis concluded that rescinding the standards would produce $600 billion to $790 billion in economic benefits. But the researchers found that conclusion depends heavily on questionable assumptions about how consumers value fuel savings and vehicle characteristics.
Studies consistently show that consumers are willing to pay less than $1 upfront for a vehicle that will provide $1 in future fuel savings. That gap can arise partly because buyers pay insufficient attention to future fuel expenses. It can also reflect trade-offs—such as reduced performance, comfort or other characteristics—that may accompany improvements in fuel efficiency.
The 2026 EPA analysis assigns only about 22 cents of each dollar in future fuel savings to the value perceived by consumers. It effectively attributes the remaining 78 cents entirely to undesirable changes in vehicle characteristics, while assigning nothing to consumers’ undervaluation of future fuel savings.
By comparison, the Biden administration’s 2024 analysis made the opposite assumption: It attributed the entire remaining 78 cents to consumer inattention and nothing to changes in vehicle characteristics.
The researchers found that neither extreme is supported by the evidence. Based on their review of the research, the authors propose allocating each dollar of fuel savings as follows: 22 cents to consumers’ willingness to pay, 55 cents to inattention or other behavioral biases, and 23 cents to trade-offs involving vehicle characteristics.
Applying that more balanced division would increase the estimated cost of rescinding the standards by $684 billion.
The researchers also identified an accounting error involving reduced driving. The EPA estimates that eliminating the standards would cause Americans to drive about 1.4 trillion fewer miles because vehicles would cost more to operate. Its analysis counts the resulting reductions in fuel, maintenance and repair expenses as benefits but fails to account for the value consumers lose when they forgo trips.
Correcting that error would increase the estimated cost of rescission by another $234 billion, the researchers found.
A third inconsistency further distorts the analysis. The EPA estimates the cost of fuel-saving technology under the assumption that automakers preserve vehicle characteristics such as weight, performance and comfort. Yet it simultaneously assumes that meeting the standards would impose large hidden costs by degrading those same characteristics.
Correcting that inconsistency could reduce the purported savings from rescinding the standards by an additional $542 billion.
The Trump administration’s analysis also excludes the environmental and public-health benefits of the standards. The Biden administration’s 2024 analysis estimated that reductions in greenhouse gases and other pollutants would generate $1.8 trillion in benefits.
The researchers said these regulatory reversals create uncertainty that can hinder automakers’ long-term investments. They called for federal agencies to adopt a consistent and transparent framework for interpreting evidence, regardless of which political party controls the White House.
They also encouraged policymakers to seriously examine alternatives, including taxes based on vehicle fuel consumption or emissions, combinations of fees and rebates, and fuel or mileage taxes. Such policies could potentially reduce emissions at a lower cost and make the costs to consumers more transparent.
“Although political power drives these swings, rigorous and transparent cost-benefit analysis—consistently applied—could moderate them,” the researchers wrote.
Author affiliations
Antonio Bento, Sol Price School of Public Policy, University of Southern California
Kenneth T. Gillingham, National Bureau of Economic Research, Cambridge, MA
Yale School of the Environment, Yale University, New Haven, CT
Mark R. Jacobsen, National Bureau of Economic Research
Department of Economics, University of California, San Diego
Christopher R. Knittel, National Bureau of Economic Research
Sloan School of Management, Massachusetts Institute of Technology
Benjamin Leard, Department of Economics, University of Tennessee
Resources for the Future
Joshua Linn, Resources for the Future
Department of Agricultural and Resource Economics, University of Maryland, College Park
David S. Rapson, Department of Economics, University of California, Davis
James M. Sallee, National Bureau of Economic Research
Haas School of Business, University of California, Berkeley
Arthur A. van Benthem, National Bureau of Economic Research
The Wharton School, University of Pennsylvania
Kate S. Whitefoot, Department of Engineering and Public Policy, Carnegie Mellon University
