We investigate the impact of subsidy on vehicle scrappage programs. In our study we find that increasing the subsidy motivates low-value consumers to replace earlier and higher subsidy induces high trade-in valuation consumers to postpone replacement. Moreover, ignoring consumer heterogeneity overestimates net benefits of scrappage program.

This seminar is only open to students of GERAD.
We would highly appreciate if you could confirm your attendance. Pizza and non alcoholic beverages will be available; you can also bring your own lunch.