Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/180288
Authors: 
Meunier, Guy
Ponssard, Jean-Pierre
Year of Publication: 
2018
Series/Report no.: 
CESifo Working Paper No. 7026
Abstract: 
We analyze the impact of indirect network effects in the deployment of zero emission vehicles in a static partial equilibrium model. In most theoretical analysis direct and indirect effects are conflated, and relatively few authors have explicitly considered indirect network effects. We also introduce the market power of vehicle producers and scale effects in the production function. The model exhibits a multiplicity of local social extrema and of market equilibria, suggesting a possibility of lock-in. The optimal set of subsidies is derived so that the Pareto dominating market equilibrium would coincide with the social optimum. This framework is applied to the case of the fuel cell electric (hydrogen) vehicles.
Subjects: 
E-mobility
network effects
joint incentives for infrastructure and car rebates
JEL: 
C61
Document Type: 
Working Paper

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