Saving Gas

October 1, 2008
A gas can

In the U.S. automotive industry, fuel efficiency is almost always reported in terms of miles per gallon. But in a report published in Science magazine, a pair of researchers from the Fuqua School of Business argue that rating efficiency by gallons per mile would help car buyers weigh their options more wisely.

Richard Larrick, an associate professor of management, and Jack Soll, an assistant professor of management, came to that conclusion after running a series of experiments to test how people responded to improvements in fuel efficiency.

They found that reporting fuel efficiency in miles per gallon, or mpg, leads consumers to believe, incorrectly, that fuel consumption is reduced at an even rate as efficiency improves. For example, most people surveyed believed that an improvement from thirty-four to fifty mpg would save more gas over 10,000 miles than an improvement from eighteen to twenty-eight mpg, even though the latter saves twice as much gas. (Going from thirty-four to fifty mpg saves ninety-four gallons; going from eighteen to twenty-eight mpg saves 198 gallons.)

These mistaken impressions were corrected when participants were presented with fuel efficiency expressed in gallons used per 100 miles rather than mpg. Viewed this way, eighteen mpg becomes 5.5 gallons per 100 miles, and twenty-eight mpg is 3.6 gallons per 100 miles—an eight-dollar savings, assuming gas is about four dollars per gallon. Thirty-four mpg translates to about 2.9 gallons per 100 miles, compared with 2.0 for fifty mpg, a savings of less than a gallon.

"This measure makes it easy to see how much gas one might use in a given year of driving and how much gas, and money, can be saved by opting for a car with greater efficiency," Larrick says.

Gallons per 10,000 miles is already the standard measure in many other countries.