Since 1990, Singapore has sought to control motor vehicle ownership by means of an auction quota system, whereby prospective vehicle buyers need to obtain a quota license before they can make their purchase. This paper assesses the success of the vehicle quota system in meeting its objectives of stability in motor vehicle growth, flexibility in the motor vehicle mix, and equity among motor vehicle buyers. Two important implementation issues-quota subcategorization and license transferability-are highlighted, and policy lessons are drawn for the design of auction quotas in general.
There is a longstanding literature on optimal government intervention to achieve non-economic objectives. This literature concludes that in the presence of the constraint that domestic consumption of a good not exceed a certain level, the social utility maximizing policy is a consumption tax on the good. 2 Assuming that the objective is to limit motorvehicleownership and assuming that there is perfect competition in the motor vehicle market, an auction quota would be equivalent to an import tariff, which, in turn—given that Singapore has no domestic
There is a long-standing literature on optimal government intervention to achieve noneconomic objectives. This literature concludes that in the presence of the constraint that domestic consumption of a good not exceed a certain level, the social utility maximizing policy is a consumption tax on the good. 1 Assuming that the objective is to limit motorvehicleownership and assuming that there is perfect competition in the motor vehicle market, an auction quota would be equivalent to an import tariff, which, in turn—given that Singapore has no domestic
Recent technological developments and past technology transitions suggest that the world
could be on the verge of a profound shift in transportation technology. The return of the electric
car and its adoption, like that of the motor vehicle in place of horses in early 20th century,
could cut oil consumption substantially in the coming decades. Our analysis suggests that oil
as the main fuel for transportation could have a much shorter life span left than commonly
assumed. In the fast adoption scenario, oil prices could converge to the level of coal prices,
about $15 per barrel in 2015 prices by the early 2040s. In this possible future, oil could become
the new coal.
Reda Cherif, Fuad Hasanov, Aditya Pande, Mr. Ray Brooks, and Mr. Ralph Chami
the motor vehicle decline. The advent of self-driving cars, ride-sharing and improved public transportation could still contribute to the decline in motorvehicleownership at the projected rates. 12
In Method II ( Figure 7 ), the slow adoption scenario, we project motorvehicleownership using the growth rate of motor vehicles at the beginning of the 20 th century to project the rise of EVs starting in 2017. This method would imply an average annual growth rate of EV ownership of 24 percent over 25 years. The method yields much lower estimates of motor vehicle
the need for additional public services. Streets must be built and maintained to facilitate the movement of people and goods; greater expenditures are needed to control infectious diseases; crime prevention becomes more essential; and expensive water, electricity, and telecommunication systems become a necessity.
For a number of reasons the need for local government services is likely to be more concentrated in highly urbanized areas of developing countries than in richer countries. First, motorvehicleownership is much more concentrated in urban areas of
vehicle registrations (including buses and light trucks).
Global Trends in Renewable Energy Investment (2016) .
Reaching the EV price threshold of around $35,000 in 2018 discussed below could trigger a motor vehicle displacement rate similar to that of horses starting in 1915. In this case, motorvehicleownership would fall by 90 percent between 2018 and early 2030s, while electric vehicles would grow at an average annual growth rate of 53 percent over 15 years.
Alternatively, we can use the evolution of the shares of horses vs
Ian W.H. Parry, Mr. Dirk Heine, Eliza Lis, and Shanjun Li
(sometimes far fewer) than 100 vehicles per thousand people.
Figure 2.3 MotorVehicleOwnership Rates, Selected Countries, 2010
(or latest available)
Source: World Bank (2013) .
Note: Motor vehicles include cars, trucks, and buses. However, two-wheeled motorized vehicles (which are used pervasively in many Asian countries) are not included in the data.
The scale of environmental problems also depends critically on a country’s fuel mix, and again there are large differences, as indicated in Figure 2.4 . For example, coal constitutes more than half of
is automatically entitled to would be easier to administer and fairer.
Reduce stamp duty rates as collections from a reformed recurrent real property tax compensate for resulting revenue losses—and only when fiscal consolidation has been achieved.
Replace the first-time homeowner’s exemption with a generally applicable tax threshold for all property conveyances.
E. Motor Vehicle Taxes
Current law and practice
85. Currently, recurrent license fees are imposed on motorvehicleownership . For the period FY2009–11, the
years ( OECD, 2007b ). Gasoline and motorvehicleownership taxes would be among the least regressive (or even progressive) environmental taxes to increase.
77. Taxes on real estate could be good candidates for increase, since these are lower than in most other EU and OECD countries . However, in line with most other countries, these taxes are levied at the sub national level, hence it would require a re-design on central-local government relations to implement an across the board surge in these taxes for broader financing purposes.