Green drivers or free riders? An analysis of tax rebates for hybrid vehicles
Sumeet Gulati and
Journal of Environmental Economics and Management, 2010, vol. 60, issue 2, 78-93
We estimate the effect of tax rebates offered by Canadian Provinces on the sales of hybrid electric vehicles. We find that these rebates led to a large increase in the market share of hybrid vehicles. In particular, we estimate that 26% of the hybrid vehicles sold during the rebate programs can be attributed to the rebate, and that intermediate cars, intermediate SUVs and some high performance compact cars were crowded out as a result. However, this implies that the rebate programs also subsidized many consumers who would have bought either hybrid vehicles or other fuel-efficient vehicles in any case. Consequently, the average cost of reducing carbon emissions from these programs is estimated to be $195 per tonne.
Keywords: Hybrid; electric; vehicles; Tax; rebate; Energy; efficiency; Carbon; policy (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeeman:v:60:y:2010:i:2:p:78-93
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Journal of Environmental Economics and Management is currently edited by M.A. Cole, A. Lange, D.J. Phaneuf, D. Popp, M.J. Roberts, M.D. Smith, C. Timmins, Q. Weninger and A.J. Yates
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