Subsidy implementation patterns and electric vehicle adoption

Many local governments provide subsidies to promote electric vehicles (EVs). These subsidies are characterised by different implementation patterns: they are provided by different levels of government, sometimes jointly financed, or retroactively implemented. However, the potential impacts of different subsidy implementation patterns on EV adoption remain unclear. In this study, we analyse the impact of local subsidy implementation patterns on EV adoption. We first propose an analytical model and then verify it empirically using monthly panel data on EV adoption in 132 Chinese cities. We find that municipal subsidies are more effective than both provincial and jointly financed subsidies in promoting EV adoption. Each 10% increase in municipal subsidies (as a share of national subsidies) can promote approximately 1000 more EVs than corresponding provincial subsidies and approximately 965 more EVs than jointly financed subsidies. Retroactive subsidies do not significantly hinder local EV adoption. Our research provides valuable empirical evidence for policymakers to steer toward more synergistic EV adoption policies.