From Accurate Labels to Interpretable Disclosure: A Consumer Policy Framework for Redesigning Korea’s Vehicle-Efficiency Labels

From Accurate Labels to Interpretable Disclosure: A Consumer Policy Framework for Redesigning Korea’s Vehicle-Efficiency Labels | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article From Accurate Labels to Interpretable Disclosure: A Consumer Policy Framework for Redesigning Korea’s Vehicle-Efficiency Labels Jae-Kyung Kim This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-9440191/v1 This work is licensed under a CC BY 4.0 License Status: Under Review Version 1 posted 6 You are reading this latest preprint version Abstract Vehicle-efficiency labels are often defended as remedies for information asymmetry, yet policy debate still focuses too narrowly on whether the certified value is technically accurate. This article argues that a second evaluative dimension is also needed: interpretive accuracy, defined not as a wholly new psychological construct but as an institutional criterion for judging whether ordinary consumers can translate a disclosed metric into a meaningful judgement about operating cost and comparative performance. Using Korea as a policy-design case, the article integrates information economics, behavioural economics, updated regulatory evidence, and Korean research on km/L-induced misperception. It treats the 2015 Korean findings as historical design anchors rather than contemporary prevalence estimates, and uses them to motivate a redesign for liquid-fuel labels that combines dual-unit disclosure, stronger cost framing, and a revised grade architecture. The article does not claim direct causal validation for the exact proposed architecture; instead, it shows why the current regime remains vulnerable to predictable misinterpretation and why the proposed architecture better aligns technical disclosure with consumer-relevant cost translation. The broader claim is that consumer-information regulation should be judged not only by truthful disclosure, but also by whether disclosure is interpretable enough to serve the policy objective for which it was mandated. vehicle-efficiency labels consumer information regulation interpretive accuracy behavioural insights energy disclosure Korea Figures Figure 1 Figure 2 Figure 3 Figure 4 Highlights • Technically accurate labels can still fail when consumers cannot interpret them in cost-relevant terms • Korea’s km/L-centred vehicle label remains vulnerable to systematic operating-cost misperception • Dual-unit labelling, stronger cost framing, and recalibrated grades improve interpretive accuracy Introduction Vehicle-efficiency labels are a classic consumer-information intervention. They are meant to reduce information asymmetry about operating costs, environmental performance, and energy efficiency at the point of purchase. Yet debates about label quality continue to focus mainly on technical accuracy—whether the certified number faithfully represents test performance—while paying less attention to how ordinary consumers translate that number into economically meaningful judgements (Akerlof, 1970; Dranove & Jin, 2010; Heinzle, 2012; Badenhoop & Riedel, 2025). This omission matters because a disclosure regime can satisfy a measurement standard and still fail as consumer policy. If consumers cannot convert a label into expected operating cost, environmental impact, or comparative advantage, the label remains formally accurate but functionally weak (Heinzle, 2012; Ceolotto & Denny, 2024). Recent work in the Journal of Consumer Policy and adjacent literatures has shown that the framing of energy information—cost units versus physical units, lifetime versus annual framing, or alternative label structures—can materially affect comprehension and choice (Kallbekken et al. , 2013; Carroll et al. , 2016; Ceolotto & Denny, 2024). The Korean vehicle-efficiency regime offers a particularly useful case. It combines a long-standing km/L metric for liquid fuels with a rapidly changing market in which electric, plug-in hybrid, and hydrogen vehicles now coexist with internal-combustion vehicles (Korea Energy Agency, 2026a, 2026c, 2026d). Korea has also expanded public disclosure tools, including portal-based annual operating-cost estimates and EV efficiency grades, but the public interface remains heavily organized around technical metrics (Korea Energy Agency, 2024, 2026a, 2026b). This combination makes Korea an informative site for asking a general consumer-policy question: when does a certified efficiency label become difficult for consumers to interpret? Related Literature and the Korean Research Context Existing international research points in three connected directions. First, work on the “MPG illusion” shows that consumers often treat fuel-economy units as if cost changed linearly with distance-per-fuel metrics, even though the true relation is inverse (Larrick & Soll, 2008; Allcott, 2013). Second, disclosure studies on household appliances show that translating technical efficiency into operating cost can alter attention and purchasing behaviour, although the direction and magnitude of the effect depend on framing and time horizon (Heinzle, 2012; Kallbekken et al. , 2013; Carroll et al. , 2016; Denny, 2022). Third, more recent consumer-policy work shows that label standardization and numerical presentation matter in their own right, especially when consumers compare categories, units, or regulatory schemes that are not directly aligned (Ceolotto & Denny, 2024; Badenhoop & Riedel, 2025). The Korean evidence base also deserves to be situated more clearly. Kim (2015) extended the MPG-illusion logic to the Korean km/L context and reported that consumers’ misperceptions were smallest around the 10 km/L region, and that perceived cost differences exhibited a contrast threshold around 2.2 km/L. Separate domestic work showed that changes in efficiency-grade information affected demand in the Korean automobile market, implying that grade architecture is behaviourally consequential rather than merely decorative (Kim & Kim, 2015). More recent Korean research beyond the vehicle-label domain likewise finds that energy-efficiency grade framing affects consumer perception and that numerical presentation and ordering can materially change communication quality (Kim & Suk, 2025). In parallel, contemporary Korean vehicle-choice research continues to show that fuel efficiency, operating cost, subsidies, and heterogeneous discounting shape transport decisions across both conventional and electric-vehicle markets (Shin & Won, 2022; Sun & Jung, 2023; Kim, Yeo, & Ahn, 2025; Joo & Kwon, 2025). This positioning also clarifies the manuscript’s relationship to recent work on car-label standardization. Badenhoop and Riedel (2025) examine fragmented EU car labels from a legal and cross-national standardization perspective. The present article addresses a different consumer-policy problem: how a technically valid disclosure can remain behaviourally opaque within one regime, and how that regime can be redesigned around interpretive accuracy. Against this background, the article advances a narrower but important claim: a vehicle-efficiency label can be technically accurate yet behaviourally misleading. To capture this problem, the article uses the term interpretive accuracy: the extent to which a disclosure enables ordinary consumers to translate certified values into meaningful comparisons about cost and performance without burdensome calculation. The term is intended as an analytical clarification and policy criterion within the broader disclosure-comprehension literature, and the Korean case is used to develop it in a policy-design rather than a new empirical format. Contributions and Scope The article makes three contributions. First, it sharpens the information-economics view of labelling by distinguishing signal validity from interpretive accuracy as separate dimensions of disclosure performance. Second, it enriches the behavioural account of vehicle choice by connecting present bias, inattention, and biased beliefs to the specific arithmetic of fuel-economy disclosure. Third, it develops an updated Korean redesign that preserves administrative continuity while improving the consumer-facing architecture of the label. The article is designed as a theory-integration and policy-design case study. It is deliberately not framed as a new empirical paper built around original survey fieldwork, experiments, or market estimation. That design choice is appropriate for two reasons. First, the article’s main objective is not to estimate a new effect size; it is to specify what a better label architecture should try to accomplish and why. Second, one of the valuable empirical pieces in the Korean literature is historical rather than current: Kim (2015) identifies the domestic contours of km/L-induced misperception and therefore provides a design anchor rather than a live behavioural estimate for 2026. The article therefore uses current official Korean sources for the institutional environment and price assumptions, while using the Korean behavioural literature as a historical anchor for redesign rather than as a substitute for new field evidence (Kim, 2015; Korea Energy Agency, 2026a, 2026b). For consumer policy, the paper’s value lies in separating a portable design principle from a case-specific calibration. The general claim is that disclosure regimes should be judged by whether they preserve the end-use meaning consumers need at an acceptable cognitive cost; the Korean anchors show how that principle can be operationalized in one market. The manuscript therefore offers a middle-range conceptual contribution and a policy-design application, not a claim to have replaced the existing disclosure-comprehension literature with an entirely new theoretical vocabulary. This differs from Badenhoop and Riedel’s (2025) cross-national legal and standardization analysis of fragmented EU car labels: the present article instead focuses on the behavioural interpretability of a single disclosure regime and on a redesign logic that can travel across contexts without assuming identical thresholds. Positioning Interpretive Accuracy A likely objection is that interpretive accuracy merely renames the existing disclosure-comprehension literature. The article, therefore, adopts a deliberately modest claim. Prior work has already shown that framing, cost translation, scale, and label structure affect understanding and choice (Heinzle, 2012; Carroll et al. , 2016; Ceolotto & Denny, 2024). The contribution here is not to deny that literature, but to extract from it an evaluative distinction that becomes especially useful for consumer policy: a regulator can certify a technically valid number while still choosing a disclosure architecture that makes the policy-relevant meaning difficult to recover (Heinzle, 2012; Carroll et al. , 2016; Ceolotto & Denny, 2024). Comprehension is often studied at the level of whether respondents understand a displayed label in an experiment. Interpretive accuracy is narrower in one sense and broader in another. It is narrower because it focuses specifically on whether consumers can translate a disclosed metric into the end judgment that motivated disclosure, such as expected operating cost or comparative performance. It is broader because it treats the translation problem as a property of the disclosure institution rather than of isolated consumer error. The term is therefore best read as an analytical criterion and normative test for disclosure design, not as a claim to have coined an entirely unprecedented psychological concept. Vehicle Efficiency Labels as Consumer-Information Institutions: Information Asymmetry, Disclosure, and Certification Cars are bundles of attributes. Some attributes are visible before purchase; some can be learned after test driving; and some remain difficult to evaluate ex ante or even ex post. Fuel economy and future operating cost belong to the latter category (Akerlof, 1970; Darby & Karni, 1973; Dranove & Jin, 2010). Consumers observe actual fuel expenses only gradually, under idiosyncratic driving conditions, and even after use, they may struggle to compare vehicles cleanly across driving style, congestion, weather, and fuel prices (Dranove & Jin, 2010). In such settings, the policy problem is not merely search cost. It is also one of certification, comparability, and the construction of market meaning (Akerlof, 1970; Darby & Karni, 1973; Dranove & Jin, 2010). From this perspective, vehicle labels are hybrid institutions. They are not simply advertising claims from sellers, nor are they simply technical measurements from regulators. They are a public mechanism that stabilizes market meaning by turning hidden or hard-to-compare performance characteristics into comparable signals (Spence, 1973; Dranove & Jin, 2010). Spence’s signalling logic is useful here, but so is the later literature on disclosure and certification: the regulator does not merely verify a number; it also organizes how that number enters consumer decision-making (Spence, 1973; Dranove & Jin, 2010). That is why label design is not a superficial presentation. It is part of the institution that allocates information in the marketplace (Dranove & Jin, 2010). The implication is that label performance has at least two dimensions. The first is signal validity: whether the disclosed value accurately represents the tested attribute. The second is interpretive accuracy: whether buyers can readily convert the disclosed value into a judgment about the consumer-relevant objective that motivated the disclosure in the first place. A label that is valid but uninterpretable can still underperform as a consumer policy because it leaves consumers with a technically correct but economically opaque signal. This distinction extends the standard information-economics account rather than rejecting it, and it organizes existing disclosure-comprehension findings around a sharper policy question: whether the form of disclosure preserves the consumer-relevant meaning the regime was meant to communicate. Behavioural Foundations of Vehicle-Efficiency Choice The Rational Benchmark and Its Cognitive Demands The neoclassical benchmark is analytically clear. A rational buyer comparing otherwise similar vehicles should evaluate the discounted value of expected future fuel-cost savings against the up-front purchase-price premium of a more efficient vehicle (Hausman, 1979; Allcott & Wozny, 2014). In principle, the calculation requires expectations about fuel prices, annual distance driven, length of ownership, vehicle survival, and a discount rate (Hausman, 1979; Allcott & Wozny, 2014). The benchmark remains useful because it clarifies what a fully informed, fully attentive, and fully calculating choice would require (Hausman, 1979; Allcott & Wozny, 2014). In practice, however, the benchmark is cognitively demanding. Even under stable price assumptions, the buyer would need to estimate years of ownership, usage intensity, resale timing, and the present value of future costs. These tasks are remote from how most consumers actually approach car purchases, and the apparent elegance of the benchmark rests on an unrealistically calculation-heavy view of consumer behaviour(Kim, 2015). For Korean car consumers, Kim (2015) found that although fuel cost mattered to most respondents, only 8.6% had attempted the kind of present-value calculation assumed by the rational benchmark. This pattern is consistent with detailed interview evidence from the United States showing that direct lifecycle-cost calculation is rare even in households with the educational background to perform it (Turrentine & Kurani, 2007). Dual-Process Cognition, Present Bias, Inattention, and Biased Beliefs The behavioural literature offers a more plausible micro-foundation. Following Kahneman’s dual-process account, routine purchase decisions are often driven less by reflective calculation than by rapid, low-effort inference (Kahneman, 2011). When the task is unfamiliar or cognitively costly, consumers rely on System 1 shortcuts rather than fully reflective System 2 calculation (Kahneman, 2011). The distinction between automatic and reflective thinking is useful here because choices about vehicle efficiency involve substantial stakes, yet the arithmetic required to evaluate them is not intuitively salient (Kim, 2015). Consumers care about fuel cost, but they do not normally compute it in the way the model assumes (Kim, 2015). Three behavioural mechanisms are especially relevant. First, present bias makes future operating savings less salient than the up-front purchase price. A higher-efficiency vehicle requires a cost now in exchange for savings later, and the later benefit is psychologically discounted more heavily than exponential discounting alone would imply (Laibson, 1997). This is one reason why empirical studies often find that expected fuel savings are underweighted relative to purchase price in vehicle choice (Busse et al. , 2013; Allcott & Wozny, 2014). Second, inattention matters because operating cost is a shrouded attribute. It is not entirely invisible, but neither is it presented in the same immediate way as sticker price, size, body style, or brand. Consumers can recover it, but only by combining future usage assumptions with a unit conversion. Gabaix and Laibson’s account of shrouded attributes and Sallee’s argument about rational inattention both help explain why consumers may not fully process energy cost, even when it affects welfare (Gabaix & Laibson, 2006; Sallee, 2014). Attention is scarce, and the information most likely to be neglected is precisely the information that requires conversion work (Sallee, 2014). Third, and most directly relevant for this article, consumers may hold biased beliefs about the relation between the disclosed metric and the underlying cost. Kahneman describes heuristic substitution and “what you see is all there is” as mechanisms through which people simplify hard problems by replacing them with easier but imperfect ones (Kahneman, 2011). In vehicle choice, the easier problem is often not “what will this car cost to fuel over time?” but “how much better does this number look than the other one on the label?” (Kahneman, 2011; Larrick & Soll, 2008). Once the metric itself encourages a misleading shortcut, biased beliefs enter the disclosure process before a fully articulated calculation ever occurs (Kahneman, 2011; Larrick & Soll, 2008; Kim, 2015). The problem was further linked to broader behavioural phenomena such as cognitive load, overconfidence, contrast effects, and reliance on immediately visible cues when consumers infer future costs (Kim, 2015). This interpretation is also supported by evidence from outside the vehicle context. Consumers frequently misjudge household energy use, focus on salient but less consequential actions, and underappreciate cumulative savings from less visible efficiency improvements (Attari et al. , 2010; Kim, 2015). The point is not simply that consumers make mistakes; it is that they predictably substitute simpler mental models when the disclosed unit does not map naturally onto the objective they care about. These behavioural mechanisms connect directly to the literature on internalities. Jaffe and Stavins (1994) framed the energy-efficiency gap in terms of barriers and market failures, but subsequent work has shown that part of the problem lies within decision processes themselves (Jaffe & Stavins, 1994; Heinzle, 2012; Gillingham & Palmer, 2014). If present bias, inattention, or distorted beliefs systematically shift consumer choices away from privately beneficial energy-saving options, the resulting inefficiency is not only external but internal to the choice process (Heinzle, 2012; Gillingham & Palmer, 2014). Recent Korean studies fit this broader pattern. Shin and Won (2022) find that fuel efficiency and fuel costs remain central predictors of vehicle selection in Korean household data. Kim et al. (2025) show that incorporating income-specific implicit discount rates changes predicted adoption patterns in Korea’s road-transport transition, especially for lower-income households. Korean consumer research on EVs likewise continues to organize perceptions around economic costs, subsidies, comparison with alternatives, and the burdens of adoption (Sun & Jung, 2023; Joo & Kwon, 2025). These studies do not directly test the km/L illusion, but they reinforce the same broader point: Korean vehicle decisions are shaped by behavioural heterogeneity, cost salience, and the form in which information is processed, not by a frictionless lifecycle-cost calculus (Shin & Won, 2022; Kim et al. , 2025; Sun & Jung, 2023; Joo & Kwon, 2025). More directly, Kim and Suk (2025) show in a non-vehicle Korean setting that the communicative power of an efficiency-grade label depends on numerical denotation and presentation order. Consumers discriminate better between high- and low-efficiency products when the grade scale and ordering are cognitively intuitive (Kim & Suk, 2025). This is highly relevant to the present paper because it implies that label architecture is itself a behavioural policy instrument. If the direction and ordering matter for appliances, the same logic is likely to matter for vehicle labels and grades, where the unit conversion problem is even more demanding (Kim & Suk, 2025). Korea’s Current Vehicle-Efficiency Disclosure Regime Korea’s current regime rests on the Energy Use Rationalization Act and detailed subordinate notices on vehicle energy-consumption efficiency, grades, and testing (Energy Use Rationalization Act, 2026; Ministry of Trade, Industry and Energy, 2023). The operational system is administered by the Korea Energy Agency (KEA), which oversees label registration, public disclosure, and a searchable comparison portal (Korea Energy Agency, 2026a). The regime now covers passenger cars, vans, and small trucks across multiple propulsion systems, including gasoline, diesel, LPG, EVs, plug-in hybrids, and hydrogen vehicles (Energy Use Rationalization Act, 2026; Korea Energy Agency, 2026a, 2026c, 2026d). Figure 1 shows current official liquid-fuel label examples for compact and non-compact internal-combustion vehicles as specified in Annex 5 to the current notice (Ministry of Trade, Industry and Energy, 2023). [Insert Fig. 1 about here] This institutional expansion matters for consumer policy because the disclosure challenge has become more complex, not less. In the earlier liquid-fuel regime, buyers mainly compared km/L values within a shared metric. The current market increasingly asks consumers to compare km/L, km/kWh, and km/kg across different propulsion systems and different public-policy objectives (Korea Energy Agency, 2026a, 2026c, 2026d). KEA’s public system responds in part by providing searchable annual fuel-cost estimates and by expanding efficiency grades to EVs (Korea Energy Agency, 2024; Korea Energy Agency, 2026b). Even so, the core disclosure structure remains heavily organized around technical units rather than directly around consumer-relevant translation rules (Korea Energy Agency, 2024, 2026a, 2026b, 2026c). The current regime has thus partially moved toward cost translation without making cost framing central to the label itself. The public portal explicitly provides estimated annual fuel costs under a 15,000 km assumption, but this remains portal-centred rather than label-centred and does not yet amount to a standardized longer-horizon cost frame across the main disclosure interface (Korea Energy Agency, 2026b). This is precisely the kind of gap that matters for consumer policy: relevant information exists in the system, but not necessarily at the point or in the format that consumers use most easily (Korea Energy Agency, 2026b). This article, therefore, draws a deliberate analytic boundary. The broader policy environment is multi-powertrain, but the design problem examined in detail here is the legacy liquid-fuel grading architecture. Korea still relies on km/L-centred disclosure most clearly in this domain, and it is also here that the historical empirical anchors in the Korean behavioural literature are strongest. Yet the underlying disclosure logic is not confined to liquid fuel vehicles. From a behavioural-economic perspective, the same problem also extends to electric and hydrogen vehicles: the denominator differs, but the core interpretive challenge remains. The decision to focus on liquid-fuel passenger vehicles is therefore not a retreat from the current market, but a way of addressing the part of the regime where reinterpretation is both feasible and policy-relevant. The regime is also still frequently evaluated through an accuracy lens. KEA’s Automobile Fuel Economy Center describes a technically sophisticated test protocol involving road-load measurement, dynamometer testing, standard cycles, and correction factors intended to narrow the gap between test values and real-world driving. These measurement improvements are important. Yet a narrow focus on measurement fidelity can obscure a distinct question: whether the disclosed output is behaviourally legible at the moment of consumer choice. This article is concerned with that second question. The km/L Problem and the Historical Korean Anchor Why Distance per Litre Invites Linear Thinking The interpretive difficulty of km/L follows from a simple mathematical fact. For a fixed distance and a fixed fuel price, fuel cost is inversely related to km/L. If f denotes composite efficiency in km/L, P fuel price, and D distance driven, operating cost can be written as follows: Small improvements at the low-efficiency end, therefore, produce much larger cost changes than identical improvements at the high-efficiency end. The metric is perfectly legitimate as a statement of test efficiency, but it is a poor shortcut for visually inferring costs. This is precisely why Larrick and Soll (2008) found that many respondents responded to MPG differences as if they mapped linearly into fuel savings. The same logic applies to km/L (Allcott, 2013; Kim, 2015). A distance-per-fuel metric visually foregrounds the numerator—how far the vehicle goes—while suppressing the fact that litres consumed per distance are what map linearly onto cost (Larrick & Soll, 2008). When consumers apply a simpler linear heuristic to an inverse relationship, they are not merely making a random mistake. They are responding to the way the metric structures attention (Larrick & Soll, 2008; Allcott, 2013). The current Korean cost benchmark makes the point concrete. Using the Korean Petroleum Association’s 2025 annual average national price for regular gasoline—KRW 1,680.29 per litre—and KEA’s public assumption of 15,000 km per year, a 10 km/L vehicle implies an annual fuel bill of about KRW 2.52 million (Korean Petroleum Association, 2026; Korea Energy Agency, 2026b). Raising efficiency from 6.2 to 10.1 km/L lowers annual cost far more than raising it from 15.0 to 18.9 km/L, even though the raw km/L difference appears similar (Korean Petroleum Association, 2026; Korea Energy Agency, 2026b; Kim, 2015). Because the current metric encourages comparison in efficiency space rather than cost space, it visually compresses the benefit of improving very low-efficiency vehicles while exaggerating the significance of equal changes near the high-efficiency end (Kim, 2015). Historical Korean Evidence and Design Anchors The original Korean empirical contribution remains highly relevant here. Kim (2015) tested whether the logic of the MPG illusion travelled to the domestic km/L context and found that it did. Korean respondents tended to interpret fuel-economy differences through distorted beliefs about the underlying cost relationship, and the distortion was not uniform across the efficiency range (Kim, 2015). Kim (2015) further reported that misperception was smallest around roughly the 10 km/L region, which is precisely the point at which km/L and L/100 km become especially easy to translate mentally. This Korean evidence is conceptually aligned with Larrick and Soll’s experimental findings and Allcott’s survey-based evidence for U.S. consumers (Larrick & Soll, 2008; Allcott, 2013; Kim, 2015). The Korean study also identified a contrast threshold of roughly 2.2 km/L (Kim, 2015). Differences smaller than that tended to be overinterpreted, whereas larger differences tended to be underinterpreted (Kim, 2015). The point is not that 10 km/L and 2.2 km/L are timeless laws of human judgment. Rather, they are historically grounded Korean anchors that capture where metric translation becomes cognitively easier and where relative comparisons begin to change character. In the context of policy design, that makes them valuable starting points for a revised grade architecture (Kim, 2015; Kim & Suk, 2025). Those anchors are strengthened, rather than weakened, by neighbouring Korean evidence. Kim and Kim (2015) show that changes in Korean fuel-economy grade information affected automobile demand, which implies that grade thresholds are behaviourally salient. Noh and Shin (2012) likewise documented the policy importance of the Korean vehicle-efficiency grade system itself. Together with Kim (2015), these studies suggest that consumer misinterpretation and grade architecture are not separate problems (Noh & Shin, 2012; Kim & Kim, 2015; Kim, 2015). The grade is one of the main interfaces through which technical efficiency is translated into consumer meaning in the Korean market (Noh & Shin, 2012; Kim & Kim, 2015; Kim, 2015). This historical anchor should be used carefully. The article does not claim that the exact magnitude of Korean misperception has remained unchanged through 2026. The current market is more technologically diverse, the public portal now provides annual cost information, and consumers face a broader set of comparison tasks. The point is narrower but still important: the earlier Korean evidence identifies stable design pressures that the current regime still needs to address, especially where the public interface remains unit-centred. What the 2015 Korean Anchor Can and Cannot Do A second likely objection concerns temporal fit: why should Korean evidence from 2015 anchor a design proposal in 2026? The answer is again narrower than a claim of behavioural stasis. The paper does not assume that the exact prevalence or magnitude of km/L misperception has remained fixed. It uses Kim (2015) because that study identifies where the Korean disclosure regime is structurally likely to create distortion. The inverse relation between km/L and fuel cost has not changed, and the liquid-fuel label still presents km/L as the primary first-glance metric even though portal-based cost information has expanded (Kim, 2015; Korea Energy Agency, 2026b). Seen this way, the 2015 findings function as design anchors rather than current prevalence estimates. They identify a cognitively salient reference region near 10 km/L and a historically observed contrast threshold around 2.2 km/L that are useful for calibrating an initial redesign (Kim, 2015). Current official price data and institutional materials are then updated to reflect the contemporary policy setting in which that redesign is assessed (Korean Petroleum Association, 2026; Korea Energy Agency, 2026a, 2026b). The proper inference is therefore not that 2015 behaviour persists unchanged, but that historically observed translation problems remain policy-relevant until the interface and metric logic that produced them are materially redesigned (Kim, 2015; Kim & Suk, 2025). Behaviourally Informed Redesign for Consumer Policy CORE Principles as Disclosure-Design Criteria A useful way to translate these insights into consumer policy is to treat label design as a structured disclosure problem. Larrick et al. (2015) summarise the relevant behavioural lessons under four CORE principles: present consumption information directly; translate it to end objectives; express it relative to meaningful comparisons; and present it on expanded scales. Read as a consumer-policy framework, these principles are not merely aesthetic guidelines. They are criteria for deciding whether a disclosure helps or hinders consumer interpretation (Larrick et al. , 2015). The first principle—consumption rather than efficiency—matters because litres per distance map linearly into fuel cost. The second principle—translation to end objectives—matters because many consumers care about efficiency largely because it implies lower running costs or lower emissions, not because the efficiency number has intrinsic value (Larrick et al. , 2015). The third principle—relative information—matters because consumers rarely evaluate an isolated number; they compare it with benchmarks, categories, or grades (Larrick et al. , 2015). The fourth principle—expanded scale—matters because larger, more consequential units often make savings easier to perceive than highly compressed annualized or per-trip metrics (Larrick et al. , 2015; Heinzle, 2012; Denny, 2022). Recent consumer-policy research supports these propositions. Heinzle (2012) shows that lifetime operating-cost disclosure can outperform narrower annual-cost framing because it better maps efficiency onto the consumer’s end objective. Carroll et al. (2016) and Denny (2022) provide field and experimental evidence that cost labelling changes appliance choice. Ceolotto and Denny (2024) demonstrate that reframing energy information can materially alter interpretation in a multi-country setting. Meanwhile, Codagnone et al. (2016) find that car eco-labels can function as nudges, but their effect depends on design and comprehension. Taken together, these findings suggest that a better vehicle label is not simply more accurate; it is easier to convert into welfare-relevant judgements (Heinzle, 2012; Carroll et al. , 2016; Ceolotto & Denny, 2024; Codagnone et al. , 2016). The Korean context adds a further design lesson. Kim and Suk (2025) show that the communicative efficiency of Korean grade labels depends on whether the number direction and ordering match intuitive interpretation. The present article extends that insight from general energy-efficiency grades to vehicle labels. In vehicle markets, the unit itself is already cognitively demanding, so problems of order, direction, and comparative framing become more—not less—important (Kim & Suk, 2025). Although a full replacement of km/L with L/100 km would be defensible in principle, it would impose transition costs in a market where the legacy metric remains widely familiar (Kim, 2015). The more realistic policy path is therefore not abrupt metric abolition but dual display and progressive re-centring of comparison around consumption and cost (Kim, 2015). Updated Liquid-Fuel Grade Architecture The first design question is whether grade architecture still matters now that KEA provides online annual cost estimates. It does, because the grade remains a fast heuristic, especially in advertising and showroom settings where consumers do not necessarily open the portal or complete a cost calculation. The current official liquid-fuel thresholds—16.0 and above, 15.9–13.8, 13.7–11.6, 11.5–9.4, and 9.3 and below—are regular in km/L space but not in consumption space (Ministry of Trade, Industry and Energy, 2023). As a result, equal-looking grade intervals in efficiency space correspond to unequal cost-relevant intervals in L/100 km space (Ministry of Trade, Industry and Energy, 2023). To update the redesign exercise with current data, the article uses three transparent rules. First, L/100 km is generated by the standard conversion: Second, annual fuel cost is calculated based on KEA’s public assumption of 15,000 km of driving per year and the Korean Petroleum Association’s 2025 annual average price for regular gasoline of KRW 1,680.29 per litre (Korean Petroleum Association, 2026; Korea Energy Agency, 2026b). Third, the five-year cost is calculated over a 75,000 km horizon derived from the same annual mileage assumption, thereby preserving consistency with a medium-horizon cost frame. These assumptions are intentionally modest and publicly traceable rather than model-specific (Korean Petroleum Association, 2026; Korea Energy Agency, 2026b; Kim, 2015). Fig. 2 translates the current official architecture into both efficiency and consumption space. The left panel reproduces the familiar km/L schedule; the right panel shows the same schedule expressed as L/100 km. The asymmetry becomes immediately visible. Middle bands widen progressively in consumption space, while the lowest grade expands dramatically. A grade system constructed in this way can still summarise efficiency, but it does not summarise cost-relevant differences evenly. [Insert Fig. 2 about here] The redesign logic retains the historical Korean anchors while updating the underlying cost calculations. The proposal keeps roughly 10 km/L as the cognitively salient centre and uses a band structure informed by the historical 2.2 km/L contrast threshold. In efficiency space, the updated thresholds become 15.1 and above, 15.0–11.2, 11.1–8.9, 8.8–7.3, and 7.2 and below. When translated into the consumption space, these map to bands that are much closer to equal width in the middle of the distribution. The point is not mathematical perfection but improved behavioural symmetry. Table 1 reports the updated proposal. Compared with the current official architecture, the proposal narrows the extreme bands and reallocates width toward the middle ranges, where consumer comparison is likely to be most common. The table also translates the proposed bands into annual and five-year fuel-cost ranges using the 2025 annual average gasoline price. This makes the design argument easier to interpret: the updated middle grades correspond to more even differences in operating-cost space than the current official structure. [Insert Table 1 about here] Fig. 3 compares the current and proposed architectures in efficiency space. This comparison is important because reform must be administratively and communicatively feasible. A redesigned architecture should improve interpretation without becoming opaque to users accustomed to the legacy system. The proposed thresholds preserve a familiar five-grade logic while shifting interval width toward more behaviourally coherent cost translation. [Insert Fig. 3 about here] Fig. 4 then presents the proposed architecture in both efficiency and consumption space. The key improvement is visible in the right-hand panel: the middle grades become much closer to symmetric in L/100 km terms, and the extreme distortion of the current lowest band is reduced. The point is not that any grade system can make cost interpretation perfect. It is that a behaviourally calibrated grade system can offer a more accurate heuristic for comparative judgement than the current one. [Insert Fig. 4 about here] This redesign should therefore be interpreted as a behaviourally informed design hypothesis rather than as direct proof of improved consumer interpretation in the current market. Dual-unit disclosure and direct cost information remain necessary. The grade redesign matters because it improves the first-glance heuristic layer of the disclosure system. A consumer who uses only the grade should face a lower risk of misreading the relative magnitude of fuel-cost differences, and a consumer who looks beyond the grade should encounter a more coherent transition from grade to cost information. Importantly, the proposal also fits the broader multi-powertrain regime better than a pure unit-replacement strategy. For liquid-fuel vehicles, dual display of km/L and L/100 km plus a recalibrated grade offers a practical transitional path. For EVs, PHEVs, and hydrogen vehicles, the same disclosure logic suggests a parallel emphasis on direct cost translation, comparable annual and multi-year cost frames, and standardized relative benchmarks rather than an insistence on a single technical metric. In that sense, the liquid-fuel redesign is not a parochial carve-out but the first step toward a more coherent cross-powertrain consumer-information strategy. Evidentiary Status of the Proposed Architecture A third likely objection concerns evidentiary status: how far can the article go in claiming that the proposed architecture would improve interpretation? The answer should be disciplined. The paper does not directly identify the causal effect of the exact proposed thresholds in the 2026 market. The strongest claim it can make is inferential and three-layered. At the arithmetic level, the proposed bands reduce asymmetry between grade intervals in efficiency space and cost-relevant intervals in consumption space. At the behavioural level, prior research shows that direction, scale, cost framing, and label ordering materially affect interpretation (Carroll et al. , 2016; Denny, 2022; Kim & Suk, 2025). At the institutional level, Korean evidence indicates that grade thresholds influence demand and therefore matter as consumer heuristics (Kim & Kim, 2015; Kim & Suk, 2025). Taken together, these layers justify the proposal as a behaviourally grounded design hypothesis for policy rather than a validated effect-size estimate. The correct claim is therefore not that the manuscript has already proven consumer-improvement effects, but that it provides a transparent rationale for why this architecture should outperform the current one on interpretability grounds and specifies how that claim can be tested. That evidentiary posture is appropriate for a theory-integration and policy-design article. Consumer Policy Implications: Korea and Beyond The article’s central implication for consumer policy is that disclosure design should be judged not only by truthfulness but also by interpretability. This is particularly important in sustainability-oriented markets, where technical metrics can be accurate yet cognitively remote from everyday decision criteria. A consumer policy that wants to foster informed choice, rather than only technically compliant disclosure, must take the interpretive step seriously. That follows from the broader relation between consumer welfare, market communication, and regulatory design. For Korea, the most feasible near-term reform is dual-unit presentation for liquid-fuel vehicles. Composite km/L should remain visible during a transition period because of legacy familiarity, but composite L/100 km should appear alongside it with equal visual status rather than as a secondary technical annotation. City and highway detail can remain in the background if needed, but the main consumer-facing comparison field should no longer rely on km/L alone. This proposal preserves comparability with historical practice while reducing the cognitive burden of cost translation. The second reform is stronger cost framing. Korea already calculates annual fuel costs in its public portal using a 15,000 km assumption (Korea Energy Agency, 2026b). The next step is to pull that logic closer to the label itself and to extend it to a longer horizon. A five-year cost figure or cost range is especially useful because it remains comprehensible to consumers while making differences in operating cost large enough to be visible. This point aligns with international evidence that longer-horizon cost framing can be more effective than minimal annual or unit-only framing in shifting attention toward energy-relevant attributes (Heinzle, 2012; Denny, 2022). The third reform is standardization across powertrains at the level of consumer objectives rather than technical units. Korea should not force all propulsion systems into one physical unit. That would likely create as many new misunderstandings as it solved. Instead, the standardization task should occur at the level of what consumers need to compare: annual running cost, multi-year running cost, greenhouse-gas information, and the relative position of the model within its appropriate comparison set. Badenhoop and Riedel’s (2025) work on fragmented EU car labels is instructive here: regulatory variation in units and thresholds can itself create market friction and consumer confusion, even when each individual label is legally valid. What Travels Beyond Korea What travels beyond Korea is not the exact cut-offs of 10 km/L or 2.2 km/L. Those are case-specific design anchors. The portable element is the regulatory logic. Whenever a disclosure regime asks consumers to convert a technically valid but cognitively awkward metric into the judgment they actually care about, the regime risks interpretive inaccuracy (Ceolotto & Denny, 2024; Badenhoop & Riedel, 2025). Korea is analytically useful because it makes that problem transparent in a setting where non-linear cost translation, legacy metric familiarity, and cross-powertrain comparison coexist (Ceolotto & Denny, 2024; Badenhoop & Riedel, 2025). This logic extends naturally to other consumer-policy domains. In vehicle markets, it speaks to jurisdictions that still rely on MPG-style or otherwise fragmented technical units and to the growing difficulty of comparing internal-combustion, hybrid, battery-electric, and hydrogen vehicles within a common consumer frame. More broadly, the same design test applies wherever labels disclose technically correct but behaviourally remote information and require consumers to perform their own conversion to end objectives. The general lesson is that regulators should standardize around consumer-relevant objectives, such as running cost or comparable performance, even when the underlying physical units differ. Limitations and Agenda for Validation The article has clear limits. It does not offer a new 2026 survey, experiment, or market-level causal estimate of how Korean consumers would respond to the revised label. The proposed thresholds, therefore, should be read as behaviourally informed design heuristics, not as a finished calibration that is already empirically validated. Nor does the paper claim that the 2015 Korean behavioural results remain numerically unchanged; it uses those results as historical anchors for a redesign in a still-relevant km/L-centred interface. The next empirical step is straightforward. A follow-up research agenda could test revised label prototypes through comprehension experiments, stated-choice surveys, dealership or portal A/B tests, and eventually administrative or market data. Those studies should distinguish between two empirical questions: whether the new label improves immediate interpretation of cost-relevant differences, and whether improved interpretation changes search, willingness to pay, or realized purchasing patterns. That sequence would allow future work to validate, refine, or reject the proposed thresholds without losing the article’s broader conceptual claim. Conclusion This article has argued that a vehicle-efficiency label can be technically accurate and still fail as consumer policy if it lacks interpretive accuracy. The Korean case makes the point vivid because the regime has expanded technologically while retaining a liquid-fuel disclosure core that still asks many consumers to translate km/L into costs on their own. Information economics helps explain why such labels exist; behavioural economics helps explain why their design still matters after accurate measurement has been achieved. The article’s empirical ambition is limited but deliberate. It does not claim to offer a new 2026 experiment on Korean consumers or definitive proof for the exact proposed thresholds. Instead, it integrates the international behavioural literature, the historical Korean evidence on km/L misperception, updated Korean regulatory data, and recent domestic research on label framing and consumer heterogeneity to build a policy-design argument. The resulting proposal is specific but appropriately modest: dual-unit labelling, label-centred annual and five-year cost disclosure, and a recalibrated liquid-fuel-grade architecture advanced as a testable behavioural redesign. In mature disclosure regimes, the policy question is no longer only whether the certified number is right. It is also whether the number is interpretable enough to serve the purpose for which disclosure was mandated. For that reason, interpretive accuracy should be treated as an explicit criterion of consumer-information regulation. Korea’s vehicle labels provide one case, but the more general lesson is portable: where consumers must perform non-trivial translation from a technical disclosure to the end judgment the policy seeks to support, regulators should redesign the disclosure rather than leave that conversion burden to consumers. Declarations Author Contribution J.K. is the sole author of this manuscript and was responsible for the study conception, research design, analysis, manuscript writing, and preparation of all figures and tables. J.K. reviewed and approved the final manuscript. Funding Declaration This research received no specific grant from any funding agency in the public, commercial, or not-for-profit sectors. References Akerlof, G. A. (1970). The market for “lemons”: Quality uncertainty and the market mechanism. 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Current official and updated proposed grade thresholds for liquid-fuel passenger vehicles Grade Current official (km/L) Updated proposed (km/L) Updated proposed (L/100 km) Annual fuel cost (million KRW) Five-year fuel cost (million KRW) Grade 1 ≥16.0 ≥15.1 ≤6.62 ≤1.67 ≤8.35 Grade 2 15.9–13.8 15.0–11.2 6.67–8.93 1.68–2.25 8.40–11.25 Grade 3 13.7–11.6 11.1–8.9 9.01–11.24 2.27–2.83 11.35–14.16 Grade 4 11.5–9.4 8.8–7.3 11.36–13.70 2.86–3.45 14.32–17.26 Grade 5 ≤9.3 ≤7.2 ≥13.89 ≥3.50 ≥17.50 Note. Cost ranges use the 2025 national annual average regular-gasoline price of KRW 1,680.29 per litre reported by the Korean Petroleum Association and the Korea Energy Agency’s annual 15,000 km benchmark; five-year values assume 75,000 k Additional Declarations No competing interests reported. Cite Share Download PDF Status: Under Review Version 1 posted Reviewers agreed at journal 01 May, 2026 Reviewers agreed at journal 01 May, 2026 Reviewers invited by journal 28 Apr, 2026 Editor assigned by journal 22 Apr, 2026 Submission checks completed at journal 21 Apr, 2026 First submitted to journal 16 Apr, 2026 You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-9440191","acceptedTermsAndConditions":true,"allowDirectSubmit":false,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":627575154,"identity":"a35ba6d8-269c-46ca-a992-af6e31d7833a","order_by":0,"name":"Jae-Kyung Kim","email":"data:image/png;base64,iVBORw0KGgoAAAANSUhEUgAAAZAAAAAyAQMAAABI0h/eAAAABlBMVEX///8AAABVwtN+AAAACXBIWXMAAA7EAAAOxAGVKw4bAAAA3klEQVRIie3QMQrCMBSA4QeBZAl0fSHgGVIERRC9ilKIi6CjoyDUpQeod3EIBNprOGWum2AHU6Rr2lEw//Ig5EtCAGKxH4xdgPqxIchyP1W3RsOE257waiwxXwKIul8bIoy5x/Oumbi57aM5wiEBqpsgIXyelm5PpNQ2LRUsbmdqyxBZE04lNycykbtccgVKGf8l4VuYk21HRH19t56shwnMJBj/MKQVge4WoHaA8JkojCai0JkoFCq0NAuTpHb4MlmGdZU2r3apkms+DZK+/mAEIKMAwGrkvlgsFvvHPs9dOnT3/gUaAAAAAElFTkSuQmCC","orcid":"","institution":"Korea Energy Economics Institute","correspondingAuthor":true,"prefix":"","firstName":"Jae-Kyung","middleName":"","lastName":"Kim","suffix":""}],"badges":[],"createdAt":"2026-04-16 15:39:56","currentVersionCode":1,"declarations":"","doi":"10.21203/rs.3.rs-9440191/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-9440191/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":107620114,"identity":"e12bd8a5-d938-456c-ae73-642018f1632b","added_by":"auto","created_at":"2026-04-23 09:34:59","extension":"jpg","order_by":1,"title":"Figure 1","display":"","copyAsset":false,"role":"figure","size":158133,"visible":true,"origin":"","legend":"\u003cp\u003eCurrent official Korean liquid-fuel vehicle-efficiency labels for compact and non-compact internal-combustion vehicles (adapted from Ministry of Trade, Industry and Energy, 2023, Annex 5)\u003c/p\u003e","description":"","filename":"Fig1.jpg","url":"https://assets-eu.researchsquare.com/files/rs-9440191/v1/b53b0c82edce9aa2cf202566.jpg"},{"id":107707413,"identity":"c3f0befd-5dc8-486c-b2fe-e5c4e26e6684","added_by":"auto","created_at":"2026-04-24 09:20:14","extension":"jpg","order_by":2,"title":"Figure 2","display":"","copyAsset":false,"role":"figure","size":573226,"visible":true,"origin":"","legend":"\u003cp\u003eCurrent official liquid-fuel grade bands in efficiency and consumption space\u003c/p\u003e","description":"","filename":"Fig2.jpg","url":"https://assets-eu.researchsquare.com/files/rs-9440191/v1/dd9331a6c645ecb9ef9c3c5f.jpg"},{"id":107707221,"identity":"8e002e91-6403-4c09-9216-eeb1674a8a37","added_by":"auto","created_at":"2026-04-24 09:19:50","extension":"jpg","order_by":3,"title":"Figure 3","display":"","copyAsset":false,"role":"figure","size":601216,"visible":true,"origin":"","legend":"\u003cp\u003eCurrent official and updated proposed liquid-fuel grade thresholds in efficiency space\u003c/p\u003e","description":"","filename":"Fig3.jpg","url":"https://assets-eu.researchsquare.com/files/rs-9440191/v1/0ed57bcf9e2e9a3a1880ea2e.jpg"},{"id":107620116,"identity":"af384235-11ab-40c2-a6b6-dbc9423331e0","added_by":"auto","created_at":"2026-04-23 09:34:59","extension":"jpg","order_by":4,"title":"Figure 4","display":"","copyAsset":false,"role":"figure","size":559775,"visible":true,"origin":"","legend":"\u003cp\u003eUpdated proposed liquid-fuel grade bands in efficiency and consumption space\u003c/p\u003e","description":"","filename":"Fig4.jpg","url":"https://assets-eu.researchsquare.com/files/rs-9440191/v1/be607351bf65ac12e39a2764.jpg"},{"id":107709351,"identity":"75c6b8fe-e112-49a6-9213-ca3d51e4051e","added_by":"auto","created_at":"2026-04-24 09:35:31","extension":"pdf","order_by":0,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":2164996,"visible":true,"origin":"","legend":"","description":"","filename":"manuscript.pdf","url":"https://assets-eu.researchsquare.com/files/rs-9440191/v1/92b7e023-f63e-4ae6-aab8-7905aef1bd8e.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"From Accurate Labels to Interpretable Disclosure: A Consumer Policy Framework for Redesigning Korea’s Vehicle-Efficiency Labels","fulltext":[{"header":"Highlights","content":"\u003cp\u003e\u0026bull; Technically accurate labels can still fail when consumers cannot interpret them in cost-relevant terms\u003c/p\u003e\n\u003cp\u003e\u0026bull; Korea\u0026rsquo;s km/L-centred vehicle label remains vulnerable to systematic operating-cost misperception\u003c/p\u003e\n\u003cp\u003e\u0026bull; Dual-unit labelling, stronger cost framing, and recalibrated grades improve interpretive accuracy\u003c/p\u003e"},{"header":"Introduction","content":"\u003cp\u003eVehicle-efficiency labels are a classic consumer-information intervention. They are meant to reduce information asymmetry about operating costs, environmental performance, and energy efficiency at the point of purchase. Yet debates about label quality continue to focus mainly on technical accuracy\u0026mdash;whether the certified number faithfully represents test performance\u0026mdash;while paying less attention to how ordinary consumers translate that number into economically meaningful judgements (Akerlof, 1970; Dranove \u0026amp; Jin, 2010; Heinzle, 2012; Badenhoop \u0026amp; Riedel, 2025).\u003c/p\u003e\n\u003cp\u003eThis omission matters because a disclosure regime can satisfy a measurement standard and still fail as consumer policy. If consumers cannot convert a label into expected operating cost, environmental impact, or comparative advantage, the label remains formally accurate but functionally weak (Heinzle, 2012; Ceolotto \u0026amp; Denny, 2024). Recent work in the Journal of Consumer Policy and adjacent literatures has shown that the framing of energy information\u0026mdash;cost units versus physical units, lifetime versus annual framing, or alternative label structures\u0026mdash;can materially affect comprehension and choice (Kallbekken \u003cem\u003eet al.\u003c/em\u003e, 2013; Carroll \u003cem\u003eet al.\u003c/em\u003e, 2016; Ceolotto \u0026amp; Denny, 2024).\u003c/p\u003e\n\u003cp\u003eThe Korean vehicle-efficiency regime offers a particularly useful case. It combines a long-standing km/L metric for liquid fuels with a rapidly changing market in which electric, plug-in hybrid, and hydrogen vehicles now coexist with internal-combustion vehicles (Korea Energy Agency, 2026a, 2026c, 2026d). Korea has also expanded public disclosure tools, including portal-based annual operating-cost estimates and EV efficiency grades, but the public interface remains heavily organized around technical metrics (Korea Energy Agency, 2024, 2026a, 2026b). This combination makes Korea an informative site for asking a general consumer-policy question: when does a certified efficiency label become difficult for consumers to interpret?\u0026nbsp;\u003c/p\u003e\n\u003cp\u003eRelated Literature and the Korean Research Context\u003c/p\u003e\n\u003cp\u003eExisting international research points in three connected directions. First, work on the \u0026ldquo;MPG illusion\u0026rdquo; shows that consumers often treat fuel-economy units as if cost changed linearly with distance-per-fuel metrics, even though the true relation is inverse (Larrick \u0026amp; Soll, 2008; Allcott, 2013). Second, disclosure studies on household appliances show that translating technical efficiency into operating cost can alter attention and purchasing behaviour, although the direction and magnitude of the effect depend on framing and time horizon (Heinzle, 2012; Kallbekken \u003cem\u003eet al.\u003c/em\u003e, 2013; Carroll \u003cem\u003eet al.\u003c/em\u003e, 2016; Denny, 2022). Third, more recent consumer-policy work shows that label standardization and numerical presentation matter in their own right, especially when consumers compare categories, units, or regulatory schemes that are not directly aligned (Ceolotto \u0026amp; Denny, 2024; Badenhoop \u0026amp; Riedel, 2025).\u003c/p\u003e\n\u003cp\u003eThe Korean evidence base also deserves to be situated more clearly. Kim (2015) extended the MPG-illusion logic to the Korean km/L context and reported that consumers\u0026rsquo; misperceptions were smallest around the 10 km/L region, and that perceived cost differences exhibited a contrast threshold around 2.2 km/L. Separate domestic work showed that changes in efficiency-grade information affected demand in the Korean automobile market, implying that grade architecture is behaviourally consequential rather than merely decorative (Kim \u0026amp; Kim, 2015). More recent Korean research beyond the vehicle-label domain likewise finds that energy-efficiency grade framing affects consumer perception and that numerical presentation and ordering can materially change communication quality (Kim \u0026amp; Suk, 2025). In parallel, contemporary Korean vehicle-choice research continues to show that fuel efficiency, operating cost, subsidies, and heterogeneous discounting shape transport decisions across both conventional and electric-vehicle markets (Shin \u0026amp; Won, 2022; Sun \u0026amp; Jung, 2023; Kim, Yeo, \u0026amp; Ahn, 2025; Joo \u0026amp; Kwon, 2025).\u003c/p\u003e\n\u003cp\u003eThis positioning also clarifies the manuscript\u0026rsquo;s relationship to recent work on car-label standardization. Badenhoop and Riedel (2025) examine fragmented EU car labels from a legal and cross-national standardization perspective. The present article addresses a different consumer-policy problem: how a technically valid disclosure can remain behaviourally opaque within one regime, and how that regime can be redesigned around interpretive accuracy.\u003c/p\u003e\n\u003cp\u003eAgainst this background, the article advances a narrower but important claim: a vehicle-efficiency label can be technically accurate yet behaviourally misleading. To capture this problem, the article uses the term interpretive accuracy: the extent to which a disclosure enables ordinary consumers to translate certified values into meaningful comparisons about cost and performance without burdensome calculation. The term is intended as an analytical clarification and policy criterion within the broader disclosure-comprehension literature, and the Korean case is used to develop it in a policy-design rather than a new empirical format.\u0026nbsp;\u003c/p\u003e\n\u003cp\u003eContributions and Scope\u003c/p\u003e\n\u003cp\u003eThe article makes three contributions. First, it sharpens the information-economics view of labelling by distinguishing signal validity from interpretive accuracy as separate dimensions of disclosure performance. Second, it enriches the behavioural account of vehicle choice by connecting present bias, inattention, and biased beliefs to the specific arithmetic of fuel-economy disclosure. Third, it develops an updated Korean redesign that preserves administrative continuity while improving the consumer-facing architecture of the label.\u003c/p\u003e\n\u003cp\u003eThe article is designed as a theory-integration and policy-design case study. It is deliberately not framed as a new empirical paper built around original survey fieldwork, experiments, or market estimation. That design choice is appropriate for two reasons. First, the article\u0026rsquo;s main objective is not to estimate a new effect size; it is to specify what a better label architecture should try to accomplish and why. Second, one of the valuable empirical pieces in the Korean literature is historical rather than current: Kim (2015) identifies the domestic contours of km/L-induced misperception and therefore provides a design anchor rather than a live behavioural estimate for 2026. The article therefore uses current official Korean sources for the institutional environment and price assumptions, while using the Korean behavioural literature as a historical anchor for redesign rather than as a substitute for new field evidence (Kim, 2015; Korea Energy Agency, 2026a, 2026b).\u003c/p\u003e\n\u003cp\u003eFor consumer policy, the paper\u0026rsquo;s value lies in separating a portable design principle from a case-specific calibration. The general claim is that disclosure regimes should be judged by whether they preserve the end-use meaning consumers need at an acceptable cognitive cost; the Korean anchors show how that principle can be operationalized in one market. The manuscript therefore offers a middle-range conceptual contribution and a policy-design application, not a claim to have replaced the existing disclosure-comprehension literature with an entirely new theoretical vocabulary. This differs from Badenhoop and Riedel\u0026rsquo;s (2025) cross-national legal and standardization analysis of fragmented EU car labels: the present article instead focuses on the behavioural interpretability of a single disclosure regime and on a redesign logic that can travel across contexts without assuming identical thresholds.\u0026nbsp;\u003c/p\u003e\n\u003cp\u003ePositioning Interpretive Accuracy\u003c/p\u003e\n\u003cp\u003eA likely objection is that interpretive accuracy merely renames the existing disclosure-comprehension literature. The article, therefore, adopts a deliberately modest claim. Prior work has already shown that framing, cost translation, scale, and label structure affect understanding and choice (Heinzle, 2012; Carroll \u003cem\u003eet al.\u003c/em\u003e, 2016; Ceolotto \u0026amp; Denny, 2024). The contribution here is not to deny that literature, but to extract from it an evaluative distinction that becomes especially useful for consumer policy: a regulator can certify a technically valid number while still choosing a disclosure architecture that makes the policy-relevant meaning difficult to recover (Heinzle, 2012; Carroll \u003cem\u003eet al.\u003c/em\u003e, 2016; Ceolotto \u0026amp; Denny, 2024).\u003c/p\u003e\n\u003cp\u003eComprehension is often studied at the level of whether respondents understand a displayed label in an experiment. Interpretive accuracy is narrower in one sense and broader in another. It is narrower because it focuses specifically on whether consumers can translate a disclosed metric into the end judgment that motivated disclosure, such as expected operating cost or comparative performance. It is broader because it treats the translation problem as a property of the disclosure institution rather than of isolated consumer error. The term is therefore best read as an analytical criterion and normative test for disclosure design, not as a claim to have coined an entirely unprecedented psychological concept.\u003c/p\u003e"},{"header":"Vehicle Efficiency Labels as Consumer-Information Institutions: Information Asymmetry, Disclosure, and Certification","content":"\u003cp\u003eCars are bundles of attributes. Some attributes are visible before purchase; some can be learned after test driving; and some remain difficult to evaluate ex ante or even ex post. Fuel economy and future operating cost belong to the latter category (Akerlof, 1970; Darby \u0026amp; Karni, 1973; Dranove \u0026amp; Jin, 2010). Consumers observe actual fuel expenses only gradually, under idiosyncratic driving conditions, and even after use, they may struggle to compare vehicles cleanly across driving style, congestion, weather, and fuel prices (Dranove \u0026amp; Jin, 2010). In such settings, the policy problem is not merely search cost. It is also one of certification, comparability, and the construction of market meaning (Akerlof, 1970; Darby \u0026amp; Karni, 1973; Dranove \u0026amp; Jin, 2010).\u003c/p\u003e\n\u003cp\u003eFrom this perspective, vehicle labels are hybrid institutions. They are not simply advertising claims from sellers, nor are they simply technical measurements from regulators. They are a public mechanism that stabilizes market meaning by turning hidden or hard-to-compare performance characteristics into comparable signals (Spence, 1973; Dranove \u0026amp; Jin, 2010). Spence\u0026rsquo;s signalling logic is useful here, but so is the later literature on disclosure and certification: the regulator does not merely verify a number; it also organizes how that number enters consumer decision-making (Spence, 1973; Dranove \u0026amp; Jin, 2010). That is why label design is not a superficial presentation. It is part of the institution that allocates information in the marketplace (Dranove \u0026amp; Jin, 2010).\u003c/p\u003e\n\u003cp\u003eThe implication is that label performance has at least two dimensions. The first is signal validity: whether the disclosed value accurately represents the tested attribute. The second is interpretive accuracy: whether buyers can readily convert the disclosed value into a judgment about the consumer-relevant objective that motivated the disclosure in the first place. A label that is valid but uninterpretable can still underperform as a consumer policy because it leaves consumers with a technically correct but economically opaque signal. This distinction extends the standard information-economics account rather than rejecting it, and it organizes existing disclosure-comprehension findings around a sharper policy question: whether the form of disclosure preserves the consumer-relevant meaning the regime was meant to communicate.\u003c/p\u003e"},{"header":"Behavioural Foundations of Vehicle-Efficiency Choice","content":"\u003cp\u003eThe Rational Benchmark and Its Cognitive Demands\u003c/p\u003e\n\u003cp\u003eThe neoclassical benchmark is analytically clear. A rational buyer comparing otherwise similar vehicles should evaluate the discounted value of expected future fuel-cost savings against the up-front purchase-price premium of a more efficient vehicle (Hausman, 1979; Allcott \u0026amp; Wozny, 2014). In principle, the calculation requires expectations about fuel prices, annual distance driven, length of ownership, vehicle survival, and a discount rate (Hausman, 1979; Allcott \u0026amp; Wozny, 2014). The benchmark remains useful because it clarifies what a fully informed, fully attentive, and fully calculating choice would require (Hausman, 1979; Allcott \u0026amp; Wozny, 2014).\u003c/p\u003e\n\u003cp\u003eIn practice, however, the benchmark is cognitively demanding. Even under stable price assumptions, the buyer would need to estimate years of ownership, usage intensity, resale timing, and the present value of future costs. These tasks are remote from how most consumers actually approach car purchases, and the apparent elegance of the benchmark rests on an unrealistically calculation-heavy view of consumer behaviour(Kim, 2015). For Korean car consumers, Kim (2015) found that although fuel cost mattered to most respondents, only 8.6% had attempted the kind of present-value calculation assumed by the rational benchmark. This pattern is consistent with detailed interview evidence from the United States showing that direct lifecycle-cost calculation is rare even in households with the educational background to perform it (Turrentine \u0026amp; Kurani, 2007).\u0026nbsp;\u003c/p\u003e\n\u003cp\u003eDual-Process Cognition, Present Bias, Inattention, and Biased Beliefs\u003c/p\u003e\n\u003cp\u003eThe behavioural literature offers a more plausible micro-foundation. Following Kahneman\u0026rsquo;s dual-process account, routine purchase decisions are often driven less by reflective calculation than by rapid, low-effort inference (Kahneman, 2011). When the task is unfamiliar or cognitively costly, consumers rely on System 1 shortcuts rather than fully reflective System 2 calculation (Kahneman, 2011). The distinction between automatic and reflective thinking is useful here because choices about vehicle efficiency involve substantial stakes, yet the arithmetic required to evaluate them is not intuitively salient\u0026nbsp;(Kim, 2015). Consumers care about fuel cost, but they do not normally compute it in the way the model assumes (Kim, 2015).\u003c/p\u003e\n\u003cp\u003eThree behavioural mechanisms are especially relevant. First, present bias makes future operating savings less salient than the up-front purchase price. A higher-efficiency vehicle requires a cost now in exchange for savings later, and the later benefit is psychologically discounted more heavily than exponential discounting alone would imply (Laibson, 1997). This is one reason why empirical studies often find that expected fuel savings are underweighted relative to purchase price in vehicle choice (Busse \u003cem\u003eet al.\u003c/em\u003e, 2013; Allcott \u0026amp; Wozny, 2014).\u003c/p\u003e\n\u003cp\u003eSecond, inattention matters because operating cost is a shrouded attribute. It is not entirely invisible, but neither is it presented in the same immediate way as sticker price, size, body style, or brand. Consumers can recover it, but only by combining future usage assumptions with a unit conversion. Gabaix and Laibson\u0026rsquo;s account of shrouded attributes and Sallee\u0026rsquo;s argument about rational inattention both help explain why consumers may not fully process energy cost, even when it affects welfare (Gabaix \u0026amp; Laibson, 2006; Sallee, 2014). Attention is scarce, and the information most likely to be neglected is precisely the information that requires conversion work (Sallee, 2014).\u003c/p\u003e\n\u003cp\u003eThird, and most directly relevant for this article, consumers may hold biased beliefs about the relation between the disclosed metric and the underlying cost. Kahneman describes heuristic substitution and \u0026ldquo;what you see is all there is\u0026rdquo; as mechanisms through which people simplify hard problems by replacing them with easier but imperfect ones (Kahneman, 2011). In vehicle choice, the easier problem is often not \u0026ldquo;what will this car cost to fuel over time?\u0026rdquo; but \u0026ldquo;how much better does this number look than the other one on the label?\u0026rdquo; (Kahneman, 2011; Larrick \u0026amp; Soll, 2008). Once the metric itself encourages a misleading shortcut, biased beliefs enter the disclosure process before a fully articulated calculation ever occurs (Kahneman, 2011; Larrick \u0026amp; Soll, 2008; Kim, 2015).\u003c/p\u003e\n\u003cp\u003eThe problem was further linked to broader behavioural phenomena such as cognitive load, overconfidence, contrast effects, and reliance on immediately visible cues when consumers infer future costs (Kim, 2015).\u0026nbsp;This interpretation is also supported by evidence from outside the vehicle context. Consumers frequently misjudge household energy use, focus on salient but less consequential actions, and underappreciate cumulative savings from less visible efficiency improvements\u0026nbsp;(Attari \u003cem\u003eet al.\u003c/em\u003e, 2010; Kim, 2015). The point is not simply that consumers make mistakes; it is that they predictably substitute simpler\u0026nbsp;mental models when the disclosed unit does not map naturally onto the objective they care about.\u003c/p\u003e\n\u003cp\u003eThese behavioural mechanisms connect directly to the literature on internalities. Jaffe and Stavins (1994) framed the energy-efficiency gap in terms of barriers and market failures, but subsequent work has shown that part of the problem lies within decision processes themselves (Jaffe \u0026amp; Stavins, 1994; Heinzle, 2012; Gillingham \u0026amp; Palmer, 2014). If present bias, inattention, or distorted beliefs systematically shift consumer choices away from privately beneficial energy-saving options, the resulting inefficiency is not only external but internal to the choice process (Heinzle, 2012; Gillingham \u0026amp; Palmer, 2014).\u003c/p\u003e\n\u003cp\u003eRecent Korean studies fit this broader pattern. Shin and Won (2022) find that fuel efficiency and fuel costs remain central predictors of vehicle selection in Korean household data. Kim \u003cem\u003eet al.\u003c/em\u003e (2025) show that incorporating income-specific implicit discount rates changes predicted adoption patterns in Korea\u0026rsquo;s road-transport transition, especially for lower-income households. Korean consumer research on EVs likewise continues to organize perceptions around economic costs, subsidies, comparison with alternatives, and the burdens of adoption (Sun \u0026amp; Jung, 2023; Joo \u0026amp; Kwon, 2025). These studies do not directly test the km/L illusion, but they reinforce the same broader point: Korean vehicle decisions are shaped by behavioural heterogeneity, cost salience, and the form in which information is processed, not by a frictionless lifecycle-cost calculus (Shin \u0026amp; Won, 2022; Kim \u003cem\u003eet al.\u003c/em\u003e, 2025; Sun \u0026amp; Jung, 2023; Joo \u0026amp; Kwon, 2025).\u003c/p\u003e\n\u003cp\u003eMore directly, Kim and Suk (2025) show in a non-vehicle Korean setting that the communicative power of an efficiency-grade label depends on numerical denotation and presentation order. Consumers discriminate better between high- and low-efficiency products when the grade scale and ordering are cognitively intuitive (Kim \u0026amp; Suk, 2025). This is highly relevant to the present paper because it implies that label architecture is itself a behavioural policy instrument. If the direction and ordering matter for appliances, the same logic is likely to matter for vehicle labels and grades, where the unit conversion problem is even more demanding (Kim \u0026amp; Suk, 2025).\u003c/p\u003e"},{"header":"Korea’s Current Vehicle-Efficiency Disclosure Regime","content":"\u003cp\u003eKorea\u0026rsquo;s current regime rests on the Energy Use Rationalization Act and detailed subordinate notices on vehicle energy-consumption efficiency, grades, and testing (Energy Use Rationalization Act, 2026; Ministry of Trade, Industry and Energy, 2023). The operational system is administered by the Korea Energy Agency (KEA), which oversees label registration, public disclosure, and a searchable comparison portal (Korea Energy Agency, 2026a). The regime now covers passenger cars, vans, and small trucks across multiple propulsion systems, including gasoline, diesel, LPG, EVs, plug-in hybrids, and hydrogen vehicles (Energy Use Rationalization Act, 2026; Korea Energy Agency, 2026a, 2026c, 2026d). Figure 1 shows current official liquid-fuel label examples for compact and non-compact internal-combustion vehicles as specified in Annex 5 to the current notice (Ministry of Trade, Industry and Energy, 2023).\u003c/p\u003e\n\u003cp\u003e\u003cem\u003e[Insert Fig. 1 about here]\u003c/em\u003e\u003c/p\u003e\n\u003cp\u003eThis institutional expansion matters for consumer policy because the disclosure challenge has become more complex, not less. In the earlier liquid-fuel regime, buyers mainly compared km/L values within a shared metric. The current market increasingly asks consumers to compare km/L, km/kWh, and km/kg across different propulsion systems and different public-policy objectives (Korea Energy Agency, 2026a, 2026c, 2026d). KEA\u0026rsquo;s public system responds in part by providing searchable annual fuel-cost estimates and by expanding efficiency grades to EVs (Korea Energy Agency, 2024; Korea Energy Agency, 2026b). Even so, the core disclosure structure remains heavily organized around technical units rather than directly around consumer-relevant translation rules (Korea Energy Agency, 2024, 2026a, 2026b, 2026c).\u003c/p\u003e\n\u003cp\u003eThe current regime has thus partially moved toward cost translation without making cost framing central to the label itself. The public portal explicitly provides estimated annual fuel costs under a 15,000 km assumption, but this remains portal-centred rather than label-centred and does not yet amount to a standardized longer-horizon cost frame across the main disclosure interface (Korea Energy Agency, 2026b). This is precisely the kind of gap that matters for consumer policy: relevant information exists in the system, but not necessarily at the point or in the format that consumers use most easily (Korea Energy Agency, 2026b).\u003c/p\u003e\n\u003cp\u003eThis article, therefore, draws a deliberate analytic boundary. The broader policy environment is multi-powertrain, but the design problem examined in detail here is the legacy liquid-fuel grading architecture. Korea still relies on km/L-centred disclosure most clearly in this domain, and it is also here that the historical empirical anchors in the Korean behavioural literature are strongest. Yet the underlying disclosure logic is not confined to liquid fuel vehicles. From a behavioural-economic perspective, the same problem also extends to electric and hydrogen vehicles: the denominator differs, but the core interpretive challenge remains. The decision to focus on liquid-fuel passenger vehicles is therefore not a retreat from the current market, but a way of addressing the part of the regime where reinterpretation is both feasible and policy-relevant.\u003c/p\u003e\n\u003cp\u003eThe regime is also still frequently evaluated through an accuracy lens. KEA\u0026rsquo;s Automobile Fuel Economy Center describes a technically sophisticated test protocol involving road-load measurement, dynamometer testing, standard cycles, and correction factors intended to narrow the gap between test values and real-world driving. These measurement improvements are important. Yet a narrow focus on measurement fidelity can obscure a distinct question: whether the disclosed output is behaviourally legible at the moment of consumer choice. This article is concerned with that second question.\u003c/p\u003e"},{"header":"The km/L Problem and the Historical Korean Anchor","content":"\u003cp\u003eWhy Distance per Litre Invites Linear Thinking\u003c/p\u003e\n\u003cp\u003eThe interpretive difficulty of km/L follows from a simple mathematical fact. For a fixed distance and a fixed fuel price, fuel cost is inversely related to km/L. If f denotes composite efficiency in km/L, P fuel price, and D distance driven, operating cost can be written as follows:\u003c/p\u003e\n\u003cp\u003e\u003cimg src=\"https://myfiles.space/user_files/58895_8739fc6c57c1c19a/58895_custom_files/img1776930830.png\" width=\"171\" height=\"85\"\u003e\u003c/p\u003e\n\u003cp\u003eSmall improvements at the low-efficiency end, therefore, produce much larger cost changes than identical improvements at the high-efficiency end. The metric is perfectly legitimate as a statement of test efficiency, but it is a poor shortcut for visually inferring costs.\u003c/p\u003e\n\u003cp\u003eThis is precisely why Larrick and Soll (2008) found that many respondents responded to MPG differences as if they mapped linearly into fuel savings. The same logic applies to km/L (Allcott, 2013; Kim, 2015). A distance-per-fuel metric visually foregrounds the numerator\u0026mdash;how far the vehicle goes\u0026mdash;while suppressing the fact that litres consumed per distance are what map linearly onto cost (Larrick \u0026amp; Soll, 2008). When consumers apply a simpler linear heuristic to an inverse relationship, they are not merely making a random mistake. They are responding to the way the metric structures attention (Larrick \u0026amp; Soll, 2008; Allcott, 2013).\u003c/p\u003e\n\u003cp\u003eThe current Korean cost benchmark makes the point concrete. Using the Korean Petroleum Association\u0026rsquo;s 2025 annual average national price for regular gasoline\u0026mdash;KRW 1,680.29 per litre\u0026mdash;and KEA\u0026rsquo;s public assumption of 15,000 km per year, a 10 km/L vehicle implies an annual fuel bill of about KRW 2.52 million (Korean Petroleum Association, 2026; Korea Energy Agency, 2026b). Raising efficiency from 6.2 to 10.1 km/L lowers annual cost far more than raising it from 15.0 to 18.9 km/L, even though the raw km/L difference appears similar (Korean Petroleum Association, 2026; Korea Energy Agency, 2026b; Kim, 2015). Because the current metric encourages comparison in efficiency space rather than cost space, it visually compresses the benefit of improving very low-efficiency vehicles while exaggerating the significance of equal changes near the high-efficiency end (Kim, 2015).\u003c/p\u003e\n\u003cp\u003eHistorical Korean Evidence and Design Anchors\u003c/p\u003e\n\u003cp\u003eThe original Korean empirical contribution remains highly relevant here. Kim (2015) tested whether the logic of the MPG illusion travelled to the domestic km/L context and found that it did. Korean respondents tended to interpret fuel-economy differences through distorted beliefs about the underlying cost relationship, and the distortion was not uniform across the efficiency range (Kim, 2015). Kim (2015) further reported that misperception was smallest around roughly the 10 km/L region, which is precisely the point at which km/L and L/100 km become especially easy to translate mentally. This Korean evidence is conceptually aligned with Larrick and Soll\u0026rsquo;s experimental findings and Allcott\u0026rsquo;s survey-based evidence for U.S. consumers (Larrick \u0026amp; Soll, 2008; Allcott, 2013; Kim, 2015).\u003c/p\u003e\n\u003cp\u003eThe Korean study also identified a contrast threshold of roughly 2.2 km/L (Kim, 2015). Differences smaller than that tended to be overinterpreted, whereas larger differences tended to be underinterpreted (Kim, 2015). The point is not that 10 km/L and 2.2 km/L are timeless laws of human judgment. Rather, they are historically grounded Korean anchors that capture where metric translation becomes cognitively easier and where relative comparisons begin to change character. In the context of policy design, that makes them valuable starting points for a revised grade architecture (Kim, 2015; Kim \u0026amp; Suk, 2025).\u003c/p\u003e\n\u003cp\u003eThose anchors are strengthened, rather than weakened, by neighbouring Korean evidence. Kim and Kim (2015) show that changes in Korean fuel-economy grade information affected automobile demand, which implies that grade thresholds are behaviourally salient. Noh and Shin (2012) likewise documented the policy importance of the Korean vehicle-efficiency grade system itself. Together with Kim (2015), these studies suggest that consumer misinterpretation and grade architecture are not separate problems (Noh \u0026amp; Shin, 2012; Kim \u0026amp; Kim, 2015; Kim, 2015). The grade is one of the main interfaces through which technical efficiency is translated into consumer meaning in the Korean market (Noh \u0026amp; Shin, 2012; Kim \u0026amp; Kim, 2015; Kim, 2015).\u003c/p\u003e\n\u003cp\u003eThis historical anchor should be used carefully. The article does not claim that the exact magnitude of Korean misperception has remained unchanged through 2026. The current market is more technologically diverse, the public portal now provides annual cost information, and consumers face a broader set of comparison tasks. The point is narrower but still important: the earlier Korean evidence identifies stable design pressures that the current regime still needs to address, especially where the public interface remains unit-centred.\u003c/p\u003e\n\u003cp\u003eWhat the 2015 Korean Anchor Can and Cannot Do\u003c/p\u003e\n\u003cp\u003eA second likely objection concerns temporal fit: why should Korean evidence from 2015 anchor a design proposal in 2026? The answer is again narrower than a claim of behavioural stasis. The paper does not assume that the exact prevalence or magnitude of km/L misperception has remained fixed. It uses Kim (2015) because that study identifies where the Korean disclosure regime is structurally likely to create distortion. The inverse relation between km/L and fuel cost has not changed, and the liquid-fuel label still presents km/L as the primary first-glance metric even though portal-based cost information has expanded (Kim, 2015; Korea Energy Agency, 2026b).\u003c/p\u003e\n\u003cp\u003eSeen this way, the 2015 findings function as design anchors rather than current prevalence estimates. They identify a cognitively salient reference region near 10 km/L and a historically observed contrast threshold around 2.2 km/L that are useful for calibrating an initial redesign (Kim, 2015). Current official price data and institutional materials are then updated to reflect the contemporary policy setting in which that redesign is assessed (Korean Petroleum Association, 2026; Korea Energy Agency, 2026a, 2026b). The proper inference is therefore not that 2015 behaviour persists unchanged, but that historically observed translation problems remain policy-relevant until the interface and metric logic that produced them are materially redesigned (Kim, 2015; Kim \u0026amp; Suk, 2025).\u003c/p\u003e"},{"header":"Behaviourally Informed Redesign for Consumer Policy","content":"\u003cp\u003eCORE Principles as Disclosure-Design Criteria\u003c/p\u003e\n\u003cp\u003eA useful way to translate these insights into consumer policy is to treat label design as a structured disclosure problem. Larrick \u003cem\u003eet al.\u003c/em\u003e (2015) summarise the relevant behavioural lessons under four CORE principles: present consumption information directly; translate it to end objectives; express it relative to meaningful comparisons; and present it on expanded scales. Read as a consumer-policy framework, these principles are not merely aesthetic guidelines. They are criteria for deciding whether a disclosure helps or hinders consumer interpretation (Larrick \u003cem\u003eet al.\u003c/em\u003e, 2015).\u003c/p\u003e\n\u003cp\u003eThe first principle\u0026mdash;consumption rather than efficiency\u0026mdash;matters because litres per distance map linearly into fuel cost. The second principle\u0026mdash;translation to end objectives\u0026mdash;matters because many consumers care about efficiency largely because it implies lower running costs or lower emissions, not because the efficiency number has intrinsic value (Larrick \u003cem\u003eet al.\u003c/em\u003e, 2015). The third principle\u0026mdash;relative information\u0026mdash;matters because consumers rarely evaluate an isolated number; they compare it with benchmarks, categories, or grades (Larrick \u003cem\u003eet al.\u003c/em\u003e, 2015). The fourth principle\u0026mdash;expanded scale\u0026mdash;matters because larger, more consequential units often make savings easier to perceive than highly compressed annualized or per-trip metrics (Larrick \u003cem\u003eet al.\u003c/em\u003e, 2015; Heinzle, 2012; Denny, 2022).\u003c/p\u003e\n\u003cp\u003eRecent consumer-policy research supports these propositions. Heinzle (2012) shows that lifetime operating-cost disclosure can outperform narrower annual-cost framing because it better maps efficiency onto the consumer\u0026rsquo;s end objective. Carroll \u003cem\u003eet al.\u003c/em\u003e (2016) and Denny (2022) provide field and experimental evidence that cost labelling changes appliance choice. Ceolotto and Denny (2024) demonstrate that reframing energy information can materially alter interpretation in a multi-country setting. Meanwhile, Codagnone \u003cem\u003eet al.\u003c/em\u003e (2016) find that car eco-labels can function as nudges, but their effect depends on design and comprehension. Taken together, these findings suggest that a better vehicle label is not simply more accurate; it is easier to convert into welfare-relevant judgements (Heinzle, 2012; Carroll \u003cem\u003eet al.\u003c/em\u003e, 2016; Ceolotto \u0026amp; Denny, 2024; Codagnone \u003cem\u003eet al.\u003c/em\u003e, 2016).\u003c/p\u003e\n\u003cp\u003eThe Korean context adds a further design lesson. Kim and Suk (2025) show that the communicative efficiency of Korean grade labels depends on whether the number direction and ordering match intuitive interpretation. The present article extends that insight from general energy-efficiency grades to vehicle labels. In vehicle markets, the unit itself is already cognitively demanding, so problems of order, direction, and comparative framing become more\u0026mdash;not less\u0026mdash;important (Kim \u0026amp; Suk, 2025).\u003c/p\u003e\n\u003cp\u003eAlthough a full replacement of km/L with L/100 km would be defensible in principle, it would impose transition costs in a market where the legacy metric remains widely familiar (Kim, 2015). The more realistic policy path is therefore not abrupt metric abolition but dual display and progressive re-centring of comparison around consumption and cost (Kim, 2015).\u003c/p\u003e\n\u003cp\u003eUpdated Liquid-Fuel Grade Architecture\u003c/p\u003e\n\u003cp\u003eThe first design question is whether grade architecture still matters now that KEA provides online annual cost estimates. It does, because the grade remains a fast heuristic, especially in advertising and showroom settings where consumers do not necessarily open the portal or complete a cost calculation. The current official liquid-fuel thresholds\u0026mdash;16.0 and above, 15.9\u0026ndash;13.8, 13.7\u0026ndash;11.6, 11.5\u0026ndash;9.4, and 9.3 and below\u0026mdash;are regular in km/L space but not in consumption space (Ministry of Trade, Industry and Energy, 2023). As a result, equal-looking grade intervals in efficiency space correspond to unequal cost-relevant intervals in L/100 km space (Ministry of Trade, Industry and Energy, 2023).\u003c/p\u003e\n\u003cp\u003eTo update the redesign exercise with current data, the article uses three transparent rules. First, L/100 km is generated by the standard conversion:\u003c/p\u003e\n\u003cp\u003e\u003cimg src=\"https://myfiles.space/user_files/58895_8739fc6c57c1c19a/58895_custom_files/img1776930921.png\" width=\"126\" height=\"90\"\u003e\u003c/p\u003e\n\u003cp\u003eSecond, annual fuel cost is calculated based on KEA\u0026rsquo;s public assumption of 15,000 km of driving per year and the Korean Petroleum Association\u0026rsquo;s 2025 annual average price for regular gasoline of KRW 1,680.29 per litre (Korean Petroleum Association, 2026; Korea Energy Agency, 2026b). Third, the five-year cost is calculated over a 75,000 km horizon derived from the same annual mileage assumption, thereby preserving consistency with a medium-horizon cost frame. These assumptions are intentionally modest and publicly traceable rather than model-specific (Korean Petroleum Association, 2026; Korea Energy Agency, 2026b; Kim, 2015).\u003c/p\u003e\n\u003cp\u003eFig. 2 translates the current official architecture into both efficiency and consumption space. The left panel reproduces the familiar km/L schedule; the right panel shows the same schedule expressed as L/100 km. The asymmetry becomes immediately visible. Middle bands widen progressively in consumption space, while the lowest grade expands dramatically. A grade system constructed in this way can still summarise efficiency, but it does not summarise cost-relevant differences evenly.\u003c/p\u003e\n\u003cp\u003e\u003cem\u003e[Insert Fig. 2 about here]\u003c/em\u003e\u003c/p\u003e\n\u003cp\u003eThe redesign logic retains the historical Korean anchors while updating the underlying cost calculations. The proposal keeps roughly 10 km/L as the cognitively salient centre and uses a band structure informed by the historical 2.2 km/L contrast threshold. In efficiency space, the updated thresholds become 15.1 and above, 15.0\u0026ndash;11.2, 11.1\u0026ndash;8.9, 8.8\u0026ndash;7.3, and 7.2 and below. When translated into the consumption space, these map to bands that are much closer to equal width in the middle of the distribution. The point is not mathematical perfection but improved behavioural symmetry.\u003c/p\u003e\n\u003cp\u003eTable 1 reports the updated proposal. Compared with the current official architecture, the proposal narrows the extreme bands and reallocates width toward the middle ranges, where consumer comparison is likely to be most common. The table also translates the proposed bands into annual and five-year fuel-cost ranges using the 2025 annual average gasoline price. This makes the design argument easier to interpret: the updated middle grades correspond to more even differences in operating-cost space than the current official structure.\u003c/p\u003e\n\u003cp\u003e\u003cem\u003e[Insert Table 1 about here]\u003c/em\u003e\u003c/p\u003e\n\u003cp\u003eFig. 3 compares the current and proposed architectures in efficiency space. This comparison is important because reform must be administratively and communicatively feasible. A redesigned architecture should improve interpretation without becoming opaque to users accustomed to the legacy system. The proposed thresholds preserve a familiar five-grade logic while shifting interval width toward more behaviourally coherent cost translation.\u003c/p\u003e\n\u003cp\u003e\u003cem\u003e[Insert Fig. 3 about here]\u003c/em\u003e\u003c/p\u003e\n\u003cp\u003eFig. 4 then presents the proposed architecture in both efficiency and consumption space. The key improvement is visible in the right-hand panel: the middle grades become much closer to symmetric in L/100 km terms, and the extreme distortion of the current lowest band is reduced. The point is not that any grade system can make cost interpretation perfect. It is that a behaviourally calibrated grade system can offer a more accurate heuristic for comparative judgement than the current one.\u003c/p\u003e\n\u003cp\u003e\u003cem\u003e[Insert Fig. 4 about here]\u003c/em\u003e\u003c/p\u003e\n\u003cp\u003eThis redesign should therefore be interpreted as a behaviourally informed design hypothesis rather than as direct proof of improved consumer interpretation in the current market. Dual-unit disclosure and direct cost information remain necessary. The grade redesign matters because it improves the first-glance heuristic layer of the disclosure system. A consumer who uses only the grade should face a lower risk of misreading the relative magnitude of fuel-cost differences, and a consumer who looks beyond the grade should encounter a more coherent transition from grade to cost information.\u003c/p\u003e\n\u003cp\u003eImportantly, the proposal also fits the broader multi-powertrain regime better than a pure unit-replacement strategy. For liquid-fuel vehicles, dual display of km/L and L/100 km plus a recalibrated grade offers a practical transitional path. For EVs, PHEVs, and hydrogen vehicles, the same disclosure logic suggests a parallel emphasis on direct cost translation, comparable annual and multi-year cost frames, and standardized relative benchmarks rather than an insistence on a single technical metric. In that sense, the liquid-fuel redesign is not a parochial carve-out but the first step toward a more coherent cross-powertrain consumer-information strategy.\u003c/p\u003e\n\u003cp\u003eEvidentiary Status of the Proposed Architecture\u003c/p\u003e\n\u003cp\u003eA third likely objection concerns evidentiary status: how far can the article go in claiming that the proposed architecture would improve interpretation? The answer should be disciplined. The paper does not directly identify the causal effect of the exact proposed thresholds in the 2026 market. The strongest claim it can make is inferential and three-layered. At the arithmetic level, the proposed bands reduce asymmetry between grade intervals in efficiency space and cost-relevant intervals in consumption space. At the behavioural level, prior research shows that direction, scale, cost framing, and label ordering materially affect interpretation (Carroll \u003cem\u003eet al.\u003c/em\u003e, 2016; Denny, 2022; Kim \u0026amp; Suk, 2025). At the institutional level, Korean evidence indicates that grade thresholds influence demand and therefore matter as consumer heuristics (Kim \u0026amp; Kim, 2015; Kim \u0026amp; Suk, 2025).\u003c/p\u003e\n\u003cp\u003eTaken together, these layers justify the proposal as a behaviourally grounded design hypothesis for policy rather than a validated effect-size estimate. The correct claim is therefore not that the manuscript has already proven consumer-improvement effects, but that it provides a transparent rationale for why this architecture should outperform the current one on interpretability grounds and specifies how that claim can be tested. That evidentiary posture is appropriate for a theory-integration and policy-design article.\u003c/p\u003e"},{"header":"Consumer Policy Implications: Korea and Beyond","content":"\u003cp\u003eThe article\u0026rsquo;s central implication for consumer policy is that disclosure design should be judged not only by truthfulness but also by interpretability. This is particularly important in sustainability-oriented markets, where technical metrics can be accurate yet cognitively remote from everyday decision criteria. A consumer policy that wants to foster informed choice, rather than only technically compliant disclosure, must take the interpretive step seriously. That follows from the broader relation between consumer welfare, market communication, and regulatory design.\u003c/p\u003e\n\u003cp\u003eFor Korea, the most feasible near-term reform is dual-unit presentation for liquid-fuel vehicles. Composite km/L should remain visible during a transition period because of legacy familiarity, but composite L/100 km should appear alongside it with equal visual status rather than as a secondary technical annotation. City and highway detail can remain in the background if needed, but the main consumer-facing comparison field should no longer rely on km/L alone. This proposal preserves comparability with historical practice while reducing the cognitive burden of cost translation.\u003c/p\u003e\n\u003cp\u003eThe second reform is stronger cost framing. Korea already calculates annual fuel costs in its public portal using a 15,000 km assumption (Korea Energy Agency, 2026b). The next step is to pull that logic closer to the label itself and to extend it to a longer horizon. A five-year cost figure or cost range is especially useful because it remains comprehensible to consumers while making differences in operating cost large enough to be visible. This point aligns with international evidence that longer-horizon cost framing can be more effective than minimal annual or unit-only framing in shifting attention toward energy-relevant attributes (Heinzle, 2012; Denny, 2022).\u003c/p\u003e\n\u003cp\u003eThe third reform is standardization across powertrains at the level of consumer objectives rather than technical units. Korea should not force all propulsion systems into one physical unit. That would likely create as many new misunderstandings as it solved. Instead, the standardization task should occur at the level of what consumers need to compare: annual running cost, multi-year running cost, greenhouse-gas information, and the relative position of the model within its appropriate comparison set. Badenhoop and Riedel\u0026rsquo;s (2025) work on fragmented EU car labels is instructive here: regulatory variation in units and thresholds can itself create market friction and consumer confusion, even when each individual label is legally valid.\u003c/p\u003e\n\u003cp\u003eWhat Travels Beyond Korea\u003c/p\u003e\n\u003cp\u003eWhat travels beyond Korea is not the exact cut-offs of 10 km/L or 2.2 km/L. Those are case-specific design anchors. The portable element is the regulatory logic. Whenever a disclosure regime asks consumers to convert a technically valid but cognitively awkward metric into the judgment they actually care about, the regime risks interpretive inaccuracy (Ceolotto \u0026amp; Denny, 2024; Badenhoop \u0026amp; Riedel, 2025). Korea is analytically useful because it makes that problem transparent in a setting where non-linear cost translation, legacy metric familiarity, and cross-powertrain comparison coexist (Ceolotto \u0026amp; Denny, 2024; Badenhoop \u0026amp; Riedel, 2025).\u003c/p\u003e\n\u003cp\u003eThis logic extends naturally to other consumer-policy domains. In vehicle markets, it speaks to jurisdictions that still rely on MPG-style or otherwise fragmented technical units and to the growing difficulty of comparing internal-combustion, hybrid, battery-electric, and hydrogen vehicles within a common consumer frame. More broadly, the same design test applies wherever labels disclose technically correct but behaviourally remote information and require consumers to perform their own conversion to end objectives. The general lesson is that regulators should standardize around consumer-relevant objectives, such as running cost or comparable performance, even when the underlying physical units differ.\u003c/p\u003e\n\u003cp\u003eLimitations and Agenda for Validation\u003c/p\u003e\n\u003cp\u003eThe article has clear limits. It does not offer a new 2026 survey, experiment, or market-level causal estimate of how Korean consumers would respond to the revised label. The proposed thresholds, therefore, should be read as behaviourally informed design heuristics, not as a finished calibration that is already empirically validated. Nor does the paper claim that the 2015 Korean behavioural results remain numerically unchanged; it uses those results as historical anchors for a redesign in a still-relevant km/L-centred interface.\u003c/p\u003e\n\u003cp\u003eThe next empirical step is straightforward. A follow-up research agenda could test revised label prototypes through comprehension experiments, stated-choice surveys, dealership or portal A/B tests, and eventually administrative or market data. Those studies should distinguish between two empirical questions: whether the new label improves immediate interpretation of cost-relevant differences, and whether improved interpretation changes search, willingness to pay, or realized purchasing patterns. That sequence would allow future work to validate, refine, or reject the proposed thresholds without losing the article\u0026rsquo;s broader conceptual claim.\u003c/p\u003e"},{"header":"Conclusion","content":"\u003cp\u003eThis article has argued that a vehicle-efficiency label can be technically accurate and still fail as consumer policy if it lacks interpretive accuracy. The Korean case makes the point vivid because the regime has expanded technologically while retaining a liquid-fuel disclosure core that still asks many consumers to translate km/L into costs on their own. Information economics helps explain why such labels exist; behavioural economics helps explain why their design still matters after accurate measurement has been achieved.\u003c/p\u003e\n\u003cp\u003eThe article\u0026rsquo;s empirical ambition is limited but deliberate. It does not claim to offer a new 2026 experiment on Korean consumers or definitive proof for the exact proposed thresholds. Instead, it integrates the international behavioural literature, the historical Korean evidence on km/L misperception, updated Korean regulatory data, and recent domestic research on label framing and consumer heterogeneity to build a policy-design argument. The resulting proposal is specific but appropriately modest: dual-unit labelling, label-centred annual and five-year cost disclosure, and a recalibrated liquid-fuel-grade architecture advanced as a testable behavioural redesign.\u003c/p\u003e\n\u003cp\u003eIn mature disclosure regimes, the policy question is no longer only whether the certified number is right. It is also whether the number is interpretable enough to serve the purpose for which disclosure was mandated. For that reason, interpretive accuracy should be treated as an explicit criterion of consumer-information regulation. Korea\u0026rsquo;s vehicle labels provide one case, but the more general lesson is portable: where consumers must perform non-trivial translation from a technical disclosure to the end judgment the policy seeks to support, regulators should redesign the disclosure rather than leave that conversion burden to consumers.\u003c/p\u003e"},{"header":"Declarations","content":"\u003ch2\u003eAuthor Contribution\u003c/h2\u003e\u003cp\u003eJ.K. is the sole author of this manuscript and was responsible for the study conception, research design, analysis, manuscript writing, and preparation of all figures and tables. J.K. reviewed and approved the final manuscript.\u003c/p\u003e\u003ch2\u003eFunding Declaration\u003c/h2\u003e\n\u003cp\u003eThis research received no specific grant from any funding agency in the public, commercial, or not-for-profit sectors.\u003c/p\u003e"},{"header":"References","content":"\u003col\u003e\n\u003cli\u003eAkerlof, G. A. (1970). 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Behavioral Science \u0026amp; Policy, 1(1), 63\u0026ndash;75. https://doi.org/10.1353/bsp.2015.0005\u003c/li\u003e\n\u003cli\u003eMinistry of Trade, Industry and Energy. (2023). Regulation on the energy consumption efficiency and grade labelling of automobiles (Notice No. 2023-157). National Law Information Center. Retrieved April 16, 2026, from https://law.go.kr/LSW/admRulLsInfoP.do?admRulSeq=2100000227240\u003c/li\u003e\n\u003cli\u003eNoh, K., \u0026amp; Shin, D. (2012). 자동차 에너지소비효율등급 체계현안 분석 및 개편방안 연구 [Issues in Korea\u0026rsquo;s automobile energy-efficiency grading system and reform options]. 에너지경제연구, 11(1), 121\u0026ndash;151. https://doi.org/10.22794/keer.2012.11.1.005\u003c/li\u003e\n\u003cli\u003eSallee, J. M. (2014). Rational inattention and energy efficiency. Journal of Law and Economics, 57(3), 781\u0026ndash;820. https://doi.org/10.1086/678927\u003c/li\u003e\n\u003cli\u003eShin, H. C., \u0026amp; Won, D. (2022). Analysis of vehicle selection factors using energy census. Environmental and Resource Economics Review, 31(2), 291\u0026ndash;317. https://doi.org/10.15266/KEREA.2022.31.2.291\u003c/li\u003e\n\u003cli\u003eSpence, M. (1973). Job market signaling. Quarterly Journal of Economics, 87(3), 355\u0026ndash;374. https://doi.org/10.2307/1882010\u003c/li\u003e\n\u003cli\u003eSun, J., \u0026amp; Jung, J. (2023). 전기차에 대한 소비자 인식 연구: 구조적 토픽모델(STM)을 중심으로 [Consumer perceptions of electric vehicles: A structural topic model analysis]. 소비자학연구, 34(3), 211\u0026ndash;242. https://doi.org/10.35736/JCS.34.3.9\u003c/li\u003e\n\u003cli\u003eTurrentine, T. S., \u0026amp; Kurani, K. S. (2007). Car buyers and fuel economy? Energy Policy, 35(2), 1213\u0026ndash;1223. https://doi.org/10.1016/j.enpol.2006.03.005\u003c/li\u003e\n\u003c/ol\u003e"},{"header":"Table","content":"\u003cp\u003e\u003cstrong\u003eTable\u0026nbsp;\u003c/strong\u003e\u003cstrong\u003e1\u003c/strong\u003e\u003cstrong\u003e.\u0026nbsp;\u003c/strong\u003eCurrent official and updated proposed grade thresholds for liquid-fuel passenger vehicles\u003c/p\u003e\n\u003cdiv align=\"\"\u003e\n \u003ctable border=\"1\" cellspacing=\"0\" cellpadding=\"0\"\u003e\n \u003cthead\u003e\n \u003ctr\u003e\n \u003ctd\u003e\n \u003cp\u003e\u003cstrong\u003eGrade\u003c/strong\u003e\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u003cstrong\u003eCurrent official\u003cbr\u003e\u0026nbsp;(km/L)\u003c/strong\u003e\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u003cstrong\u003eUpdated proposed\u003cbr\u003e\u0026nbsp;(km/L)\u003c/strong\u003e\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u003cstrong\u003eUpdated proposed\u003cbr\u003e\u0026nbsp;(L/100 km)\u003c/strong\u003e\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u003cstrong\u003eAnnual fuel cost\u003cbr\u003e\u0026nbsp;(million KRW)\u003c/strong\u003e\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u003cstrong\u003eFive-year fuel cost\u003cbr\u003e\u0026nbsp;(million KRW)\u003c/strong\u003e\u003c/p\u003e\n \u003c/td\u003e\n \u003c/tr\u003e\n \u003c/thead\u003e\n \u003ctbody\u003e\n \u003ctr\u003e\n \u003ctd\u003e\n \u003cp\u003eGrade 1\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u0026ge;16.0\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u0026ge;15.1\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u0026le;6.62\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u0026le;1.67\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u0026le;8.35\u003c/p\u003e\n \u003c/td\u003e\n \u003c/tr\u003e\n \u003ctr\u003e\n \u003ctd\u003e\n \u003cp\u003eGrade 2\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e15.9\u0026ndash;13.8\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e15.0\u0026ndash;11.2\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e6.67\u0026ndash;8.93\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e1.68\u0026ndash;2.25\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e8.40\u0026ndash;11.25\u003c/p\u003e\n \u003c/td\u003e\n \u003c/tr\u003e\n \u003ctr\u003e\n \u003ctd\u003e\n \u003cp\u003eGrade 3\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e13.7\u0026ndash;11.6\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e11.1\u0026ndash;8.9\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e9.01\u0026ndash;11.24\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e2.27\u0026ndash;2.83\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e11.35\u0026ndash;14.16\u003c/p\u003e\n \u003c/td\u003e\n \u003c/tr\u003e\n \u003ctr\u003e\n \u003ctd\u003e\n \u003cp\u003eGrade 4\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e11.5\u0026ndash;9.4\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e8.8\u0026ndash;7.3\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e11.36\u0026ndash;13.70\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e2.86\u0026ndash;3.45\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e14.32\u0026ndash;17.26\u003c/p\u003e\n \u003c/td\u003e\n \u003c/tr\u003e\n \u003ctr\u003e\n \u003ctd\u003e\n \u003cp\u003eGrade 5\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u0026le;9.3\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u0026le;7.2\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u0026ge;13.89\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u0026ge;3.50\u003c/p\u003e\n \u003c/td\u003e\n \u003ctd\u003e\n \u003cp\u003e\u0026ge;17.50\u003c/p\u003e\n \u003c/td\u003e\n \u003c/tr\u003e\n \u003c/tbody\u003e\n \u003c/table\u003e\n\u003c/div\u003e\n\u003cp\u003e\u003cem\u003eNote.\u003c/em\u003e Cost ranges use the 2025 national annual average regular-gasoline price of KRW 1,680.29 per litre reported by the Korean Petroleum Association and the Korea Energy Agency\u0026rsquo;s annual 15,000 km benchmark; five-year values assume 75,000 k\u003c/p\u003e"}],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":true,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":true,"hideJournal":false,"highlight":"","institution":"","isAcceptedByJournal":false,"isAuthorSuppliedPdf":false,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":false,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"journal-of-consumer-policy","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":false,"externalIdentity":"copo","sideBox":"Learn more about [Journal of Consumer Policy](http://link.springer.com/journal/10603)","snPcode":"10603","submissionUrl":"https://submission.springernature.com/new-submission/10603/3","title":"Journal of Consumer Policy","twitterHandle":"","acdcEnabled":true,"dfaEnabled":true,"editorialSystem":"stoa","reportingPortfolio":"Springer Hybrid","inReviewEnabled":true,"inReviewRevisionsEnabled":false},"keywords":"vehicle-efficiency labels, consumer information regulation, interpretive accuracy, behavioural insights, energy disclosure, Korea","lastPublishedDoi":"10.21203/rs.3.rs-9440191/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-9440191/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eVehicle-efficiency labels are often defended as remedies for information asymmetry, yet policy debate still focuses too narrowly on whether the certified value is technically accurate. This article argues that a second evaluative dimension is also needed: interpretive accuracy, defined not as a wholly new psychological construct but as an institutional criterion for judging whether ordinary consumers can translate a disclosed metric into a meaningful judgement about operating cost and comparative performance. Using Korea as a policy-design case, the article integrates information economics, behavioural economics, updated regulatory evidence, and Korean research on km/L-induced misperception. It treats the 2015 Korean findings as historical design anchors rather than contemporary prevalence estimates, and uses them to motivate a redesign for liquid-fuel labels that combines dual-unit disclosure, stronger cost framing, and a revised grade architecture. The article does not claim direct causal validation for the exact proposed architecture; instead, it shows why the current regime remains vulnerable to predictable misinterpretation and why the proposed architecture better aligns technical disclosure with consumer-relevant cost translation. The broader claim is that consumer-information regulation should be judged not only by truthful disclosure, but also by whether disclosure is interpretable enough to serve the policy objective for which it was mandated.\u003c/p\u003e","manuscriptTitle":"From Accurate Labels to Interpretable Disclosure: A Consumer Policy Framework for Redesigning Korea’s Vehicle-Efficiency Labels","msid":"","msnumber":"","nonDraftVersions":[{"code":1,"date":"2026-04-23 09:34:50","doi":"10.21203/rs.3.rs-9440191/v1","editorialEvents":[{"type":"communityComments","content":0},{"type":"reviewerAgreed","content":"19755729002576481089779651696411179589","date":"2026-05-02T01:40:10+00:00","index":"hide","fulltext":""},{"type":"reviewerAgreed","content":"63256533453125023822347106672832313649","date":"2026-05-01T09:15:40+00:00","index":"hide","fulltext":""},{"type":"reviewersInvited","content":"","date":"2026-04-28T14:14:13+00:00","index":"","fulltext":""},{"type":"editorAssigned","content":"","date":"2026-04-22T08:16:48+00:00","index":"","fulltext":""},{"type":"checksComplete","content":"","date":"2026-04-21T07:08:40+00:00","index":"","fulltext":""},{"type":"submitted","content":"Journal of Consumer Policy","date":"2026-04-16T15:23:24+00:00","index":"","fulltext":""}],"status":"published","journal":{"display":true,"email":"[email protected]","identity":"journal-of-consumer-policy","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":false,"externalIdentity":"copo","sideBox":"Learn more about [Journal of Consumer Policy](http://link.springer.com/journal/10603)","snPcode":"10603","submissionUrl":"https://submission.springernature.com/new-submission/10603/3","title":"Journal of Consumer Policy","twitterHandle":"","acdcEnabled":true,"dfaEnabled":true,"editorialSystem":"stoa","reportingPortfolio":"Springer Hybrid","inReviewEnabled":true,"inReviewRevisionsEnabled":false}}],"origin":"","ownerIdentity":"21c034ab-d0e1-4850-8a3d-19c336469bbf","owner":[],"postedDate":"April 23rd, 2026","published":true,"recentEditorialEvents":[{"type":"reviewerAgreed","content":"19755729002576481089779651696411179589","date":"2026-05-02T01:40:10+00:00","index":15,"fulltext":""},{"type":"reviewerAgreed","content":"63256533453125023822347106672832313649","date":"2026-05-01T09:15:40+00:00","index":14,"fulltext":""}],"rejectedJournal":[],"revision":"","amendment":"","status":"under-review","subjectAreas":[],"tags":[],"updatedAt":"2026-04-28T14:24:15+00:00","versionOfRecord":[],"versionCreatedAt":"2026-04-23 09:34:50","video":"","vorDoi":"","vorDoiUrl":"","workflowStages":[]},"version":"v1","identity":"rs-9440191","journalConfig":"researchsquare"},"__N_SSP":true},"page":"/article/[identity]/[[...version]]","query":{"redirect":"/article/rs-9440191","identity":"rs-9440191","version":["v1"]},"buildId":"XKTyCvWXoU3ODBz1xrDgd","isFallback":false,"isExperimentalCompile":false,"dynamicIds":[84888],"gssp":true,"scriptLoader":[]}