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Is California’s Electric Vehicle Rebate Regressive? A Distributional Analysis

Published online by Cambridge University Press:  11 March 2022

Arthur L. Ku  and
John D. Graham
Arthur L. Ku*
Affiliation:
Center for Global Sustainability, University of Maryland, 3101 Van Munching Hall, College Park, MD 20742, USA
John D. Graham
Affiliation:
Paul H. O’Neill School of Public and Environmental Affairs, Indiana University, Bloomington, IN 47405, USA
*
*Corresponding author: e-mail: alku@umd.edu
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Abstract

Economic incentives are in widespread use to stimulate the development of the electric vehicle industry. However, the distributional effects of such incentives have been subject to little empirical inquiry. This study examines how California’s electric vehicle rebate program impacts different income groups financially. Two effects are considered: the income distribution of rebate beneficiaries and the income distribution of the rebate payers. The results reveal that the overall net financial impacts of the electric vehicle rebate program are regressive: the benefit distribution is highly regressive while the cost distribution is slightly progressive. Recent efforts to improve the fairness of the rebate program do not alter our findings. Policy implications are discussed.

Keywords

cap-and-tradeelectric vehicleenvironmental justiceequitypublic financerebatesH2

Information

Type
Article
Information
Journal of Benefit-Cost Analysis , Volume 13 , Issue 1 , Spring 2022 , pp. 1 - 19
Copyright
© The Author(s), 2022. Published by Cambridge University Press on behalf of the Society for Benefit-Cost Analysis

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