Funded by The Australian Research Council (Discovery Project)
Funding Amount: $608,491
Project start date: 2025
Researchers
- Prof Fedor Iskhakov (CI), ANU
- Prof Bertel Schjerning (PI), University of Copenhagen
- Prof Kenneth Gillingham (PI), Yale University
- Prof John Rust (PI), Georgetown University
Project Description
Highly desirable transition to environmentally friendly technologies such as electric automobiles requires well-designed governmental support. Short-sighted policies may lead to unintended consequences and do more harm than good. The importance of a secondary market for durable goods makes the policy design a complex dynamic problem. This project will produce mathematical and computational tools to explore potential regulation standards and stimulus programs in a simulated environment to find an optimal approach for expanding electric cars in Australia. Built on the team's groundbreaking research in modelling equilibria in markets for automobiles, this project will enable the search for optimal policy that will benefit Australian society.
National Interest Statement
The expansion of electric vehicles (EVs) is crucial for decarbonizing the Australian economy, requiring effective policies to support EV adoption. This focus has intensified with the "New Vehicle Efficiency Standard" and the ongoing parliamentary Inquiry into the transition to electric vehicles. This project develops a comprehensive toolkit, incorporating a mathematical framework and computer models for realistic, data-driven, and theoretically sound analysis of durable markets, such as the car market. This toolkit will simulate EV adoption under various policy regimes, aiming to accelerate the transition and minimize costs to individuals, firms, and the economy. It will provide valuable insights into optimal policy design, helping to avoid unintended adverse consequences like rebound effects, market distortions, and social or cultural inequalities during the electrification of Australian automobiles.