Green Car Adoption and the Supply of Alternative Fuels

Giulia Pavan

No 17-875, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: Easy access to stations serving alternative fuels is an obvious concern for customers considering to buy a "green" car. Yet, the supply of fuel is seldom considered analyzing how to promote the adoption of environmentally friendly vehicles. I develop and estimate a joint model of demand for cars and supply of alternative fuels. I use this framework to compare the effectiveness of a subsidy to consumers who buy cars running on alternative fuels to that of a subsidy to gas stations installing alternative fuel pumps. Counterfactual simulations suggest that subsidizing fuel retailers to offer alternative fuels is a more effective policy that indirectly increases low emission car sales.

Keywords: Alternative fuel cars; Entry; Environmental policy (search for similar items in EconPapers)
JEL-codes: H23 H25 L11 L91 Q48 (search for similar items in EconPapers)
Date: 2017-12
New Economics Papers: this item is included in nep-ene, nep-env and nep-tre
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:32303

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