Impact of policy incentives on electric vehicles development: a system dynamics-based evolutionary game theoretical analysis

Abstract

A system dynamics-based evolutionary game theoretical analysis is proposed to examine the impact of policy incentives, i.e., price subsidy and taxation preference on electric vehicles (EVs) industry development. Two case scenarios were used to distinguish policy performance by dividing it into a static and dynamic incentive. The result reflected that the game in implementation of the static incentive policy did not achieve stable equilibrium, indicating that such a policy is not effective for driving the development of the EVs industry. However, the game had stable equilibrium when dynamic incentive policy was implemented. The taxation preference had better performance in incentivizing EVs production than the direct subsidy. The study is expected to provide insight into policy making in the industrial transition toward low-carbon consumption. Limitations are given to indicate opportunities for further research.