Author, as appears in the article.: Theilen B; Tomori F

Department: Economia

URV's Author/s: Theilen, Bernd Georg

Keywords: Subsidy scheme Innovation Fuel-powered vehicles Environmental regulation Emission standards Electric vehicles Commitment

Abstract: We compare two regulatory structures in the application of emission standards and a subsidy scheme in the automobile market. The regulator can either commit to an emission standard or is not able to commit. Firms compete á la Cournot and produce fuel-powered and electric vehicles. The emissions of fuel-powered vehicles can be abated by means of investing in emission-reducing innovation. Our results indicate that under commitment there are less emissions, higher subsidies and a major adoption of electric vehicles. By contrast, non-commitment yields more fuel-powered vehicles, more vehicles in total and higher consumer surplus. Electric vehicle producers obtain higher profits under commitment, whereas fuel-powered vehicle producers might be better off under both regulatory structures. Social welfare is higher under non-commitment as long as environmental damages are regarded severe. Otherwise, commitment is socially preferable. This result provides an explanation for observed differences in the duration of environmental standards between the US, the EU and China.

Thematic Areas: General o multidisciplinar Environmental studies Economics and econometrics Economics Economia Ciencias sociales

licence for use: https://creativecommons.org/licenses/by/3.0/es/

Author's mail: bernd.theilen@urv.cat

Author identifier: 0000-0001-7141-2780

Record's date: 2023-08-05

Papper version: info:eu-repo/semantics/publishedVersion

Papper original source: Resource And Energy Economics. 74

APA: Theilen B; Tomori F (2023). Regulatory commitment versus non-commitment: Electric vehicle adoption under subsidies and emission standards. Resource And Energy Economics, 74(), -. DOI: 10.1016/j.reseneeco.2023.101388

Licence document URL: http://repositori.urv.cat/ca/proteccio-de-dades/

Article's DOI: 10.1016/j.reseneeco.2023.101388

Entity: Universitat Rovira i Virgili

Journal publication year: 2023

Publication Type: Journal Publications