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Local Incentives and Electric Vehicle Adoption

Author

Listed:
  • Askill H. Halse
  • Karen E. Hauge
  • Elisabeth T. Isaksen
  • Bjørn G. Johansen
  • Oddbjørn Raaum

Abstract

We study how the adoption of battery electric vehicles—a key technology for decarbonizing transportation—responds to two local incentives: road toll exemption and bus lane access. Combining rich Norwegian microdata with a quasi-experimental research design where we exploit household-level variations in incentives on work commutes, we find sizable and positive effects on electric vehicle ownership. The increase in electric vehicles from having road tolls and bus lanes on work commutes is, on average, offset by a similar decline in the ownership of conventional vehicles. Still, road toll exposure increases total car ownership among the richest households. Road tolls also reduce “brown” driving per vehicle, but lower CO2 emissions are largely due to the reduction in the number of conventional vehicles.

Suggested Citation

  • Askill H. Halse & Karen E. Hauge & Elisabeth T. Isaksen & Bjørn G. Johansen & Oddbjørn Raaum, 2025. "Local Incentives and Electric Vehicle Adoption," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 12(1), pages 145-180.
    • Handle: RePEc:ucp:jaerec:doi:10.1086/730590
    DOI: 10.1086/730590
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    1. Nano Barahona & Francisco A Gallego & Juan-Pablo Montero, 2020. "Vintage-Specific Driving Restrictions," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 87(4), pages 1646-1682.
    2. Jonn Axsen & Patrick Plötz & Michael Wolinetz, 2020. "Crafting strong, integrated policy mixes for deep CO2 mitigation in road transport," Nature Climate Change, Nature, vol. 10(9), pages 809-818, September.
    3. Antonio Bento & Daniel Kaffine & Kevin Roth & Matthew Zaragoza-Watkins, 2014. "The Effects of Regulation in the Presence of Multiple Unpriced Externalities: Evidence from the Transportation Sector," American Economic Journal: Economic Policy, American Economic Association, vol. 6(3), pages 1-29, August.
    4. Clinton, Bentley C. & Steinberg, Daniel C., 2019. "Providing the Spark: Impact of financial incentives on battery electric vehicle adoption," Journal of Environmental Economics and Management, Elsevier, vol. 98(C).
    5. James Archsmith & Erich Muehlegger & David S. Rapson, 2022. "Future Paths of Electric Vehicle Adoption in the United States: Predictable Determinants, Obstacles, and Opportunities," Environmental and Energy Policy and the Economy, University of Chicago Press, vol. 3(1), pages 71-110.
    6. Youssouf Camara & Bjart Holtsmark & Florian Misch, 2021. "Electric Vehicles, Tax incentives and Emissions: Evidence from Norway," IMF Working Papers 2021/162, International Monetary Fund.
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    Cited by:

    1. Brita Bye & Kevin R. Kaushal & Orvika Rosnes & Karen Turner & Hidemichi Yonezawa, 2023. "The Road to a Low Emission Society: Costs of Interacting Climate Regulations," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 86(3), pages 565-603, November.
    2. Koch, Nicolas & Ritter, Nolan & Rohlf, Alexander & Scarazzato, Francesco, 2022. "When is the electric vehicle market self-sustaining? Evidence from Norway," Energy Economics, Elsevier, vol. 110(C).

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    More about this item

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy

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