Electric Vehicles, Tax incentives and Emissions: Evidence from Norway

Youssouf Camara, Bjart Holtsmark and Florian Misch

No 2021/162, IMF Working Papers from International Monetary Fund

Abstract: This paper empirically estimates the effects of electric vehicles (EVs) on passenger car emissions to inform the design of policies that encourage EV purchases in Norway. We use exceptionally rich data on the universe of cars and households from Norway, which has a very high share of EVs, thanks to generous tax incentives and other policies. Our estimates suggest that household-level emission savings from the purchase of additional EVs are limited, resulting in high implicit abatement costs of Norway’s tax incentives relative to emission savings. However, the estimated emission savings are much larger if EVs replace the dirtiest cars. Norway’s experience may also help inform similar policies in other countries as they ramp up their own national climate mitigation strategies.

Keywords: emission savings; passenger car emission; savings from the purchase; car usage preference; purchased EVs; Tax incentives; Income; VAT exemptions; Greenhouse gas emissions (search for similar items in EconPapers)
Pages: 25
Date: 2021-06-08
New Economics Papers: this item is included in nep-ene, nep-env, nep-pbe, nep-reg and nep-tre
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Citations: View citations in EconPapers (2)

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