I can't be wrong in the economic effects of smaller cars, but,
you might be right about the extra driving that people might be tempted to do with the better MPG cars. But that in itself, is also a negative, since, like I mentioned in one of my posts above, a smaller car with depreciate faster than a bigger care, and it a smaller car is driven moe because of that better MPG, then, that car will be "aged" faster, which will create a demand for the consumer to have to make another purchase sooner than he would with a bigger car. Smaller cars might give better MPG, in absolute terms, but, in the long run, and like you said, it's going to present an incentive to the owner to drive it more, thereby obliterating whatever advantage the smaller vehicle had.
But, there will still exist the people who don't understand the consequences of regulations, and will continue to vote, naively, vote for those who pass the feel good regulations and legislation.
