Green Cars Adoption and the Supply of Alternative Fuels

Pavan, Giulia (2015) Green Cars Adoption and the Supply of Alternative Fuels.

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Official URL: http://tse-fr.eu/pub/31108

Abstract

Easy availability of stations serving alternative fuels is an obvious concern for customers considering to buy a “green” car. Yet, the supply of fuel is seldom considered when analyzing the problem of fostering the adoption of environmentally friendly vehicles. I develop and estimate a joint model of demand for green cars and supply of alternative fuels. Customers care about the density of stations offering the fuel their car runs on in their market; stations only supply fuels whose stock of circulating cars is large enough to cover the fixed cost of building an alternative fuel pump. I use this framework to compare the effectiveness of a subsidy to consumers who buy cars running on alternative fuels to that of a subsidy to gas stations installing alternative fuel pumps. Counterfactual simulations suggest that subsidizing fuel retailers to offer alternative fuels is an effective policy to indirectly increase low emission car sales.

Item Type: Monograph (Working Paper)
Language: English
Date: October 2015
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse)
Institution: Université Toulouse 1 Capitole
Site: UT1
Date Deposited: 29 Oct 2016 08:38
Last Modified: 07 Mar 2018 13:24
OAI ID: oai:tse-fr.eu:31108
URI: http://publications.ut-capitole.fr/id/eprint/22445

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