Optimal policy and network effects for the deployment of zero emission vehicles

Guy Meunier and Jean-Pierre Ponssard

European Economic Review, 2020, vol. 126, issue C

Abstract: We analyze the impact of indirect network effects in the deployment of zero emission vehicles in a static partial equilibrium model. In most theoretical analyses, direct and indirect effects are conflated, and relatively few authors have explicitly considered indirect network effects. We also introduce the market power of vehicle producers and scale effects in the production function. The model exhibits a multiplicity of local social critical points and market equilibria, suggesting a possibility of lock-in. The optimal two subsidies for vehicles and stations are derived so that the Pareto dominating market equilibrium would coincide with the social optimum. Configurations associated with different values of the parameters are explored to revisit the policy issues at various stages of deployment of hydrogen and battery electric vehicles.

Keywords: Network effects; Technology deployment; Lock-in; Optimal policy (search for similar items in EconPapers)
JEL-codes: C61 Q42 Q55 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0014292120300817
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Optimal policy and network effects for the deployment of zero emission vehicles (2020)
Working Paper: Optimal Policy and Network Effects for the Deployment of Zero Emission Vehicles (2018)
Working Paper: Optimal Policy and Network Effects for the Deployment of Zero Emission Vehicles * (2018)
Working Paper: Optimal Policy and Network Effects for the Deployment of Zero Emission Vehicles * (2018)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:126:y:2020:i:c:s0014292120300817

DOI: 10.1016/j.euroecorev.2020.103449

Access Statistics for this article

European Economic Review is currently edited by T.S. Eicher, A. Imrohoroglu, E. Leeper, J. Oechssler and M. Pesendorfer

More articles in European Economic Review from Elsevier
Bibliographic data for series maintained by Catherine Liu ().