Paths to the adoption of electric vehicles: An evolutionary game theoretical approach

Abstract

Electric vehicles (EVs) are a viable alternative to internal combustion engine (ICE) vehicles, with the potential to alleviate the negative externalities stemming from the present ICE-based transportation sector. Notwithstanding, the current prevalence of ICE creates a lock-in state that averts the adoption of alternative and environmental friendly technologies, bringing forth a social dilemma. Here we investigate the feasibility of escaping the present lock-in state by studying possible incentive mechanisms involving, simultaneously, governments (public), companies (private) and consumers (civil). Resorting to evolutionary game theory (EGT), we develop a theoretical model grounded on the strategic interactions between players from the different sectors, whose co-evolving choices influence (and are influenced by) different policies and social incentives. Our findings suggest that i) public regulation is necessary but not sufficient for guaranteeing full EV adoption; ii) public-civil synergies are essential; iii) demand for EVs preceding supply is most efficient, providing companies with the needed incentives to counterweigh infrastructure investments; and iv) full adoption of EVs requires coordination between the three sectors to emerge, particularly when changes are initiated by the public sector.