 Optimal incentive for electric vehicle adoptionPaolo Falbo, Cristian Pelizzari and Giorgio Rizzini Energy Economics, 2022, vol. 114, issue C Abstract: This paper is concerned with the interactions between a policymaker and a population of vehicle owners through a bilevel model. The policymaker aims to minimize a cost function to come up with the optimal incentive for encouraging the largest possible percentage of fossil fuel vehicle owners to purchase an electric vehicle. The fossil fuel vehicle owners have to decide whether to purchase an electric vehicle or not. Both the policymaker and the fossil fuel vehicle owners care about the PM10 concentration. In particular, the policymaker can decide to impose a traffic ban if the PM10 concentration exceeds the safety threshold for many consecutive days. Traffic bans generate a cost to the owners of a fossil fuel vehicle. We reduce the initial bilevel problem to a single-level problem and analytically solve it. We further provide a model calibration on real data and a detailed comparative statics. Keywords: Environmental Policy; Bilevel Problems; Electric Vehicles (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:114:y:2022:i:c:s0140988322004066 DOI: 10.1016/j.eneco.2022.106270 Access Statistics for this article Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant More articles in Energy Economics from Elsevier |
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