Research
Policies for Electric Vehicles Adoption: Evidence from Beijing
- Job Market Paper đźš—
Abstract: In response to global climate change and environmental problems, policymakers around the world have implemented various initiatives to promote electric vehicle (EV) adoption. I employ a structural model to evaluate the impacts of two demand-side interventions: EV subsidies and the green license plate (GLP) policy on EV adoption and examines the welfare impacts of these two policies. Using data from China’s automobile industry, I estimate a demand model for vehicles that endogenizes consumer choices for license plates while accounting for consumer demographic heterogeneity. On the supply side, I estimate marginal costs based on Nash-Bertrand pricing. My counterfactual analysis indicates that the GLP policy was remarkably effective in boosting EV sales, equivalent to approximately $7,839 per EV in subsidies in Beijing, 2015. However, while it was effective in increasing sales, the policy also led to greater market power for EV producers, resulting in higher EV prices. When considering environmental externalities, both the EV subsidies and the GLP policy enhance net welfare surplus by 3.16% and 6.84%, respectively. Furthermore, I analyze the optimal level of EV subsidies in conjunction with the GLP policy and propose alternative policy designs that could be more efficient than the current practices in Beijing.
Heterogeneous Impacts of Vertical Restraints Antitrust Event? Evidence from China
- Working Paper
Abstract: I examine the impacts of vertical restraints antitrust practices on consumer and producer behaviors in the auto market, using China’s first antitrust case (the 2014 Audi case) as an exogenous shock, and investigate the persistence of these impacts. Using a combination of difference-in-differences and demand estimation methods, I find that the 2014 antitrust event led to a 4% decrease in prices set by Audi automakers and an 84% increase in sales of Audi. Leveraging novel transaction-level data, I study the differences between transaction prices set by dealers and manufacturers’ suggested retail prices (MSRP) to determine whether the event led to significant changes in the vertical relationship. The results show that the transaction price to MSRP ratio did not decrease significantly after the event, implying no observed increase in dealers’ market power. I conclude that the antitrust case on automakers’ price control actions is likely to be a one-shot market shock in China’s auto market.