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Governmental platform intermediation to promote alternative fuel vehicles

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  • Dietrich, Antje-Mareike

Abstract

Many governments promote green technological innovation within the automobile sector as a means of combating climate change. Most of these innovations are driven by alternative fuels. Buyer's premiums and governmental investment in service infrastructure are widely used. This paper investigates the question regarding whether market intervention is adequate by considering the two-sided market character of the automobile market. This study shows that network effects, competition effects triggered by more automobile users and decreasing marginal utilities of further service stations determine the welfare-efficient extent of governmental intervention. The results of the analysis indicate that governmental promotion of service infrastructure is reasonable, although governments should be cautious about buyer's premiums.

Suggested Citation

  • Dietrich, Antje-Mareike, 2016. "Governmental platform intermediation to promote alternative fuel vehicles," Economics Department Working Paper Series 16, Technische Universität Braunschweig, Economics Department.
  • Handle: RePEc:zbw:tbswps:16
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    References listed on IDEAS

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    More about this item

    Keywords

    network effects; two-sided markets; platform intermediation; alternative fuel vehicles; climate change; regulation;

    JEL classification:

    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
    • L98 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Government Policy
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • 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

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