Electric Vehicle Subsidies in the Era of Attribute-Based Regulations
Author:
- 1 March 2017
- journal article
- research article
- Published by University of Toronto Press Inc. (UTPress) in Canadian Public Policy
- Vol. 43 (1) , 50-60
Abstract
Electric vehicle (EV) subsidies are costly and ineffective policy mechanisms in the battle against greenhouse gases. Furthermore, their operation is not well understood given the new regulatory environment governing emissions standards and fuel efficiency that is common to the United States and Canada. Given these standards, the sale of more EVs permits manufacturers to sell fossil fuel vehicles with higher carbon dioxide (CO2) emissions. Paradoxically, more EV sales result in more CO2 emissions. I explore possible rationales for subsidies, but none is easily validated. Consequently, the case for traditional externality-correcting policies such as carbon taxation that approximate “first-best” solutions is compelling.Keywords
This publication has 15 references indexed in Scilit:
- Gasoline Prices and Fuel Economy of New Vehicles in QuebecCanadian Public Policy, 2016
- Designing Policies to Make Cars Greener: A Review of the Literature2016
- Will We Ever Stop Using Fossil Fuels?Journal of Economic Perspectives, 2016
- Energy policy with externalities and internalitiesJournal of Public Economics, 2014
- Market-Based Policies for Green Motoring in CanadaCanadian Public Policy, 2013
- Are Consumers Myopic? Evidence from New and Used Car PurchasesAmerican Economic Review, 2013
- What Does it Cost Society to Raise a Dollar of Tax Revenue? The Marginal Cost of Public FundsSSRN Electronic Journal, 2011
- Giving green to get green? Incentives and consumer adoption of hybrid vehicle technologyJournal of Environmental Economics and Management, 2011
- Green drivers or free riders? An analysis of tax rebates for hybrid vehiclesJournal of Environmental Economics and Management, 2010
- Salience and Taxation: Theory and EvidenceAmerican Economic Review, 2009