Incentivizing the adoption of electric vehicles under subsidy schemes: A duopoly analysis

Yongling GAO, Mingming LENG

Research output: Journal PublicationsJournal Article (refereed)peer-review

Abstract

We analyze the competition between an electric vehicle (EV) manufacturer and an internal combustion vehicle manufacturer, under a government's subsidy scheme that provides a per-unit subsidy to the EV manufacturer or a price discount subsidy to EV consumers. The government should adopt the per-unit subsidy scheme, because, compared to the price-discount scheme, the government under the per-unit scheme can achieve the same EV sales and social welfare but pay for a smaller total subsidy.
Original languageEnglish
Pages (from-to)473-476
Number of pages4
JournalOperations Research Letters
Volume49
Issue number4
Early online date13 May 2021
DOIs
Publication statusPublished - Jul 2021

Bibliographical note

Funding Information:
The first author ( Yongling Gao ) was supported by the Humanities and Social Science Research Project of Ministry of Education of China ( 17YJC630027 ) and the National Social Science Fund of China ( 18BGL217 ). The second author ( Mingming Leng ) was supported by the General Research Fund (GRF) of the Hong Kong Research Grants Council under Research Project No. LU13500020 .

Publisher Copyright:
© 2021 Elsevier B.V.

Keywords

  • Electric vehicles
  • Subsidy
  • Driving range
  • Game theory
  • Duopoly

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