Do fewer people mean fewer cars? Population decline and car ownership in Germany

Drawing on household data from Germany, this study econometrically analyzes the determinants of automobile ownership, focusing specifically on the extent to which decreases in family size translate into changes in the number of cars at the national level. Beyond modeling several variables over which policy makers have direct leverage, including the proximity of public transit, fuel prices and land use density, the analysis uses the estimated coefficients from a multinomial logit model to simulate car ownership rates under alternative scenarios pertaining to demographic change and other socio-economic variables. Our baseline scenario predicts continued increases in the number of cars despite decreases in population, a trend that is attributed to continued increases in household income.

► We project car ownership in Germany under alternative scenarios pertaining to demographic change. ► The model predicts a moderate increase in car ownership by 2030 despite declines in Germany’s population. ► The projected increase in cars is predicated on steady increases in household income. ► Assuming constant income, car ownership is predicted to decrease slightly by 2030. ► The distance to and quality of public transit are significant determinants of car ownership.