Logo image
Back
Accelerating the adoption of automated vehicles by subsidies: A dynamic games approach
Journal article   Open access   Peer reviewed

Accelerating the adoption of automated vehicles by subsidies: A dynamic games approach

Qi Luo, Romesh Saigal, Zhibin Chen and Yafeng Yin
Transportation research. Part B: methodological, Vol.129, pp.226-243
11/01/2019
DOI: 10.1016/j.trb.2019.09.011
url
https://doi.org/10.1016/j.trb.2019.09.011View
Published (Version of record) Open Access

Abstract

•Accelerate the early deployment of AV by subsidy for long-term benefits.•A dynamic games approach to design AV subsidy with asymmetric information.•Subsidy policies are adaptive to the market penetration process.•A unique two-threshold, non-monotonic structure in AV subsidy policy.•Subsidizer yields a higher cumulative payoff comparing to welfare maximization. Early deployment of automated vehicles (AVs) may likely cause a loss of efficiency in the transportation system. However, after there are a sufficient number of such vehicles in the traffic stream, many benefits can be realized. It thus appears sensible to provide subsidies to promote the early adoption of AVs and shorten the transition period. This paper investigates an optimal subsidy policy that accelerates the deployment of AVs from lower to higher market penetration rates. The policy can maximize the government agency’s expected total payoff associated with the AV deployment. The main contribution is a dynamic games approach that considers the uncertainty in the market forecast and the information asymmetry between the government agency and the subsidized entities.
 Automated vehicles Diffusion of innovations Dynamic Stackelberg games Subsidy policy

Details

Metrics

14 Record Views
62 Times Cited - Web of Science
Logo image