Knowing your car's miles per gallon isn't going to get you very far. Last summer, Richard Larrick and Jack Soll, professors at Duke's Fuqua School of Business, published a paper arguing that Americans did not understand how fuel efficiency works. They found that most people assumed that improving a car's..

Knowing your car's miles per gallon isn't going to get you very far.

Last summer, Richard Larrick and Jack Soll, professors at Duke's Fuqua School of Business, published a paper arguing that Americans did not understand how fuel efficiency works. They found that most people assumed that improving a car's miles per gallon from 25 mpg to 50 mpg would save more gas over 10,000 miles than an improvement from 10 mpg to 20 mpg. But when you do the math, the latter saves more than twice as much (see chart). "Miles per gallon," they argued, was misleading and did not help drivers understand how much gas they were using. The proposed solution: gallons per mile.GOOD: So, miles per gallon doesn't actually measure how much gas you use?RICHARD LARRICK: The paper was cowritten with a colleague of mine and we actually live near each other and carpool in his Camry hybrid, which has an mpg readout on it. One day, we were watching it and seeing the good and bad mileage. We were thinking about whether you could average together the miles-per-gallon readout to get total miles per gallon, and we realized that the math of miles per gallon gets tricky and it can be really misleading.Imagine that you are driving uphill for 100 miles and you're getting 10 miles per gallon, and then you just turned around and drove down the same hill for 100 miles and you got 100 miles per gallon on the way downhill. And the question is: What is your average miles per gallon over that distance?It feels like it should be about 50, but it turns out it's 20.The amount of gas you're using to go 100 miles when you're getting 10 mpg is 10 gallons. And when you're getting 100 mpg as you're driving 100 miles, you use just one gallon. So you're using a total of 11 gallons to go 200 miles, and that gets you a little bit under 20 miles per gallon.G: Do you have any idea how we ended up with this measurement of fuel economy that doesn't really tell us how much gas we're using?RL: [My colleague and I] speculate that when we first had cars, and gas stations were few and far between, maybe it actually mattered that you knew exactly how far you could go on a tank of gas before needing to be able to refill it.G: Are you seeing more and more people considering using gallons per mile?RL: A little bit. One of the things we've discovered in the process of publishing this and having it be publicized quite a bit over the summer was that conversations like this had gone on at Consumer Reports and car magazines in the past. The engineers know that there's this problem with miles per gallon. But everyone assumes that because we're so used to mpg-which we are-that people are not going to be open to changing anything.I'm kind of frustrated because I've tried to reach out to the EPA several times. The one thing they do [on fueleconomy.gov] is gallons per 25 miles. So that is there. And that's been there since before we did our research. But my problem with that is that 25 miles is too small a distance to actually see the difference in cars. So it's always .9, 1.2, 1.1-to me, all those numbers of gallons look the same.We actually prefer 10,000 miles. The key thing about 10,000 miles is that is the distance that many people drive in a year. In fact, they often drive more. It really gives you a sense of, Okay, a year's worth of driving is going to use 400 gallons, or 700 gallons.G: What about car companies? Any sense they'll start using different numbers?RL: People are always curious-who does this benefit? I'm not really sure if Toyota or Detroit is favored more by this. But I think you can make the argument that it's Detroit, which was putting hybrids on SUVs and being ridiculed for it. Well, our analysis indicates that's exactly right. Because to get a car from 14 mpg to 20 mpg is just a huge, huge improvement in reducing gas consumption.I do know that, in 2004, Honda and Toyota called for supplementing miles per gallon with gallons per 100 miles. And I only discovered this after we published the paper, so it wasn't something we were able to even cite because we didn't even know about it at the time. They heard people complaining that the Prius wasn't getting 50 mpg and that it was getting 42 mpg instead, and people were so frustrated to lose the eight miles per gallon, but once you flip the numbers over you realize you're talking about a few gallons per hundred miles.G: So, what's the next step? How can we use this new knowledge?RL: This helps us understand that pulling cars out of the teens [in terms of miles per gallon] is so much more valuable than pushing an efficient car even higher. That only becomes clear when you start thinking about gallons per mile. That tiny increase from 10 mpg to 11 mpg saves essentially the same one gallon of gas every 100 miles as does increasing 33 mpg to 50 mpg.In no way do we advocate that people should stop at 11 mpg, but it at least focuses your attention on getting all those cars in the teens up into the twenties where literally hundreds of gallons of gas will be saved for every 10,000 miles of driving.