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Do tax incentives affect households׳ adoption of ‘green’ cars? A panel study of the Stockholm congestion tax

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  • Mannberg, Andrea
  • Jansson, Johan
  • Pettersson, Thomas
  • Brännlund, Runar
  • Lindgren, Urban
Abstract
Policymakers have made several attempts to introduce local and national policies to reduce CO2 emissions and stimulate the consumer adoption of alternative fuel vehicles (ethanol/E85 cars). The purpose of this paper is to analyze how a local policy measure impacts the composition of the car fleet over time. More specifically, we take advantage of the natural experiment setting caused by the introduction of the Stockholm congestion tax (2006) to analyze how the tax affected purchases of ethanol cars that were exempted from the tax. To estimate effects, we employ a Difference-in-differences methodology. By using a comprehensive database of the car fleet and car owners, sociodemographic and geographic factors are analyzed, which is unique in the existing literature. Our results suggest that the congestion tax had a significant impact on ethanol car purchases although the effect fades away over time. Furthermore, there is a positive relationship between the level of education and ethanol car purchases. Previous adoption of an ethanol car is found to be the strongest predictor of ethanol car purchases. Finally, data indicate that Stockholmers substantially increased purchases of ethanol cars half a year before the introduction of the congestion tax, which we refer to as an anticipation effect.

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  • Mannberg, Andrea & Jansson, Johan & Pettersson, Thomas & Brännlund, Runar & Lindgren, Urban, 2014. "Do tax incentives affect households׳ adoption of ‘green’ cars? A panel study of the Stockholm congestion tax," Energy Policy, Elsevier, vol. 74(C), pages 286-299.
    • Handle: RePEc:eee:enepol:v:74:y:2014:i:c:p:286-299
    DOI: 10.1016/j.enpol.2014.08.029
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    4. Zeinab Rezvani & Johan Jansson & Maria Bengtsson, 2018. "Consumer motivations for sustainable consumption: The interaction of gain, normative and hedonic motivations on electric vehicle adoption," Business Strategy and the Environment, Wiley Blackwell, vol. 27(8), pages 1272-1283, December.
    5. Berkeley, Nigel & Bailey, David & Jones, Andrew & Jarvis, David, 2017. "Assessing the transition towards Battery Electric Vehicles: A Multi-Level Perspective on drivers of, and barriers to, take up," Transportation Research Part A: Policy and Practice, Elsevier, vol. 106(C), pages 320-332.
    6. Sergio Luis Náñez Alonso, 2020. "The Tax Incentives in the IVTM and “Eco-Friendly Cars”: The Spanish Case," Sustainability, MDPI, vol. 12(8), pages 1-29, April.
    7. Song, Jinbo & Nie, Rong & Yuan, Hehui & Gao, Jingxin, 2023. "Does the renovation of waste-to-energy incineration plants attenuate the housing price gradient? Evidence from a quasi-natural experiment in Shenzhen, China," Energy Economics, Elsevier, vol. 120(C).
    8. Kester, Johannes & Sovacool, Benjamin K. & Noel, Lance & Zarazua de Rubens, Gerardo, 2020. "Rethinking the spatiality of Nordic electric vehicles and their popularity in urban environments: Moving beyond the city?," Journal of Transport Geography, Elsevier, vol. 82(C).
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    10. Chankrajang, Thanyaporn & Muttarak, Raya, 2017. "Green Returns to Education: Does Schooling Contribute to Pro-Environmental Behaviours? Evidence from Thailand," Ecological Economics, Elsevier, vol. 131(C), pages 434-448.
    11. De Borger, Bruno & Glazer, Amihai & Proost, Stef, 2022. "Strategic behavior under tradeable driving permits and congestion tolls: A political economy model," Journal of Urban Economics, Elsevier, vol. 128(C).
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