Wen Tian from Penn State University will present "The Roles of Subsidy and Green License Policy in Putting More Electric Vehicles on the Road: Evidence from Beijing"

Abstract:

In response to global climate change and environmental problems, policymakers worldwide have implemented various policies to put more electric vehicles (EVs) on the road. In this study, I evaluate the impacts of two demand-side interventions - EV subsidies and the green license plate policy (which exempts EVs from stringent vehicle license quota restrictions) on the EV market in Beijing. I develop a two-stage discrete choice model incorporating consumers’ preferences for license plate types and vehicle models and estimate the demand model using product-level data with consumer-level microdata. I find that the green license plate policy is as effective as EV subsidies in promoting EV sales, and it is equivalent to approximately $7,839 subsidies in deploying EVs in Beijing, in 2015. The results also show that the green license plate policy led to increased market power of EV producers implying the critical role of government in designing the EV promotion policies.