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Electric Vehicles, Tax incentives and Emissions: Evidence from Norway
Author: Youssouf Camara, Bjart Holtsmark, and Florian Misch
Series:
IMF Working Papers
Volume/Issue:
Volume 2021: Issue 162
Language:
English
Publication Date:
08 Jun 2021
DOI:
https://doi.org/10.5089/9781513582818.001
ISBN:
9781513582818
ISSN:
1018-5941
Pages:
25
Keywords:
emission savings; passenger car emission; savings from the purchase; car usage preference; purchased EVs; Tax incentives; Income; VAT exemptions; Greenhouse gas emissions
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper empirically estimates the effects of electric vehicles (EVs) on passenger car emissions to inform the design of policies that encourage EV purchases in Norway. We use exceptionally rich data on the universe of cars and households from Norway, which has a very high share of EVs, thanks to generous tax incentives and other policies. Our estimates suggest that household-level emission savings from the purchase of additional EVs are limited, resulting in high implicit abatement costs of Norway’s tax incentives relative to emission savings. However, the estimated emission savings are much larger if EVs replace the dirtiest cars. Norway’s experience may also help inform similar policies in other countries as they ramp up their own national climate mitigation strategies.
Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund