Effectiveness of collaborative policy tools for promoting electric vehicles

Abstract

The tools of government play a critical role in prospective emerging industries such as electric vehicles (EV) and are of great importance during periods of crisis. With limited capacities and resources during the COVID-19 pandemic, governments adopted collaborative policy tools to achieve strategic goals by gathering social resources. However, existing evidence indicates that collaborative policy tools can lead to uncertain outcomes, notably because of goal ambiguity and complex relationships among stakeholders. In this study, we assess the effectiveness of a collaborative program (engaging local governments, an NGO, and multiple EV manufacturers) − named “New Energy Vehicle to Countryside (NEV2C)” − to promote EV sales in rural areas. Drawing on panel data covering 24 months and 31 provinces, we use a set of two-way fixed-effect models and counterfactual estimators to evaluate the overall effectiveness of the NEV2C program and to capture the moderating effects of local conditions and local policies. The results indicate that the NEV2C program effectively increases EV sales in the treated provinces. The local number of charging piles and the local income level are positively associated with the NEV2C effectiveness. The local EV purchase subsidies could work as complementary support to improve the NEV2C effectiveness. Based on the findings of this study, we suggest governments adopt collaborative policy tools more frequently, especially during a time of crisis, such as the pandemic, paying careful attention to the policy arena, sectoral choice, and working mechanisms. To promote a specific emerging industry like EV using collaborative policy tools, we recommend first implementing demonstration programs in the regions with better industrial foundations, market potential, and local policy support to improve program effectiveness.