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Do tax incentives affect households' adoption of ‘green’ cars?: A panel study of the Stockholm congestion tax
Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Economics.
Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Business Administration.ORCID iD: 0000-0003-2593-9439
Umeå University, Faculty of Social Sciences, Department of Geography and Economic History.
Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Economics.
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2014 (English)In: Energy Policy, ISSN 0301-4215, Vol. 74, 286-299 p.Article in journal (Refereed) Published
Abstract [en]

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.

Place, publisher, year, edition, pages
2014. Vol. 74, 286-299 p.
Keyword [en]
ethanol cars, congestion tax, natural experiment
National Category
Economics and Business
Research subject
Social and Economic Geography
URN: urn:nbn:se:umu:diva-95394DOI: 10.1016/j.enpol.2014.08.029ISI: 000345470300028OAI: diva2:759051
Riksbankens Jubileumsfond, P11-0339


Available from: 2014-10-28 Created: 2014-10-28 Last updated: 2015-02-03Bibliographically approved

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Mannberg, AndreaJansson, JohanPettersson, ThomasBrännlund, RunarLindgren, Urban
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