The Economics of Electric Vehicles and the Need for a Public Policy

Abstract

Electric vehicles (EVs) are an emerging technology in today’s transportation industry. EVs and charging infrastructure are not only complementary, but also the elements of an ecosystem. The economic value of the ecosystem increases with a feedback loop. The spread of EVs increases the motivation to build charging infrastructure, and the availability of charging infrastructure motivates the purchase of EVs. Therefore, there is a need for a public policy to manage this feedback loop.

Keywords: the economics of electric vehicles, public policy

JEL Classification: L52, L98, R48