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Subsidy strategy on new-energy vehicle based on incomplete information: A Case in China

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  • Zhang, Hao
  • Cai, Guixin

Abstract

According to pilot subsidy policy for new energy vehicles in China, this paper introduces a signaling game model to explore the adverse selection issue in the process of subsidy and to analyze the game equilibrium between government and automobile enterprises. The results show that the development level of new-energy vehicles determines the different strategies adopted by enterprises in the process of obtaining subsidies. The government can dynamically adjust the subsidies policy in the following ways. In the early stage of research and development of new energy vehicles, appropriate subsidies should be given to enterprises. Before the new energy vehicles go on the market, the establishment of new energy vehicle infrastructure should be concentrated. After the vehicle enters the market, the government should provide necessary support for the purchase of new energy vehicles and expand the market share of new energy vehicles.

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  • Zhang, Hao & Cai, Guixin, 2020. "Subsidy strategy on new-energy vehicle based on incomplete information: A Case in China," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 541(C).
    • Handle: RePEc:eee:phsmap:v:541:y:2020:i:c:s0378437119318849
    DOI: 10.1016/j.physa.2019.123370
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