Our figure of the month 06/2016: Purchase grant for electric cars with positive effects on employment by industry


On 18 May 2016, the Federal Cabinet has entrusted the Ministry of Economy and Energy (BMWi) with the implementation of the purchase grant for electric cars. The support is financed equally with federal funds and resources to the automotive industry and amounts to EUR 1.2 billion. In a simple sensitivity analysis with the macroeconomic model INFORGE we identified the effects on individual industries. The simulation assumes that households spend an additional amount of EUR 1.2 billion on vehicles. The manufacturing industry (inter alia, the automotive industry) and trade (inter alia motor trade) can benefit. Positive effects also occur in the service sectors.


In addition to the results for the labor market, the simulation suggests other aspects worth considering. For instance, import competition with international players, changing production structures, new inputs and investment behavior of the automotive industry, development of infrastructure ("charge stations"), effects on the environment and emissions, changing demand for skills and occupations as well as social consequences. However, these aspects can be investigated only in a more detailed scenario and are relevant for future research.

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