Abstract

Local government of Jakarta issued a bylaw on air pollution controls for mobile sources, stipulates that all private car owners must get their vehicles’ emission tested biennially. In consequence of non-compliance vehicle in emissions test, vehicle maintenance is essential. Vehicle owner should take an appropriate action in order to reduce pollutant level lower than standard. This study attempts to analyze economic aspect and emission level considerations come into making optimal choice of vehicle owner. First, we examine the influential factors of action taken in maintenance process of non-compliance vehicle on probability of vehicle to pass the second stage emissions test. Second, due to variation of actions taken in the maintenance process, we analyze impact on cost and explore components affects on variation of maintenance cost. Empirical analysis was done by using Inspection and Maintenance data in year 2000 which collected at several auto-mechanic shops in Jakarta city. The bivariate probit model was applied to examine impact of chosen alternatives on the probability to pass Hydrocarbon and Carbon Monoxide in second emission test. To examine variation of maintenance cost and explore components affects on cost, multilevel approach was applied. It is confirm that several actions may increase probability to pass emission test but on the same time reduce average cost. Other actions may simultaneously increase probability to pass emission test and also increase cost. It was also found some actions didn`t have impact on emission test but on the other hand rise maintenance cost. Furthermore, some actions reduce probability to pass emission test but increase maintenance cost. Vehicle owner need to properly select actions in order to maximize benefit and minimize cost.

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