Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/142236
Authors: 
Dietrich, Antje-Mareike
Year of Publication: 
2016
Series/Report no.: 
Economics Department Working Paper Series 16
Abstract: 
Many governments promote green technological innovation within the automobile sector as a means of combating climate change. Most of these innovations are driven by alternative fuels. Buyer's premiums and governmental investment in service infrastructure are widely used. This paper investigates the question regarding whether market intervention is adequate by considering the two-sided market character of the automobile market. This study shows that network effects, competition effects triggered by more automobile users and decreasing marginal utilities of further service stations determine the welfare-efficient extent of governmental intervention. The results of the analysis indicate that governmental promotion of service infrastructure is reasonable, although governments should be cautious about buyer's premiums.
Subjects: 
network effects
two-sided markets
platform intermediation
alternative fuel vehicles
climate change
regulation
JEL: 
L15
L92
L98
O33
Q55
Q58
Document Type: 
Working Paper

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