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Influence of government financial incentives on electric car adoption: empirical evidence from India

Influence of government financial incentives on electric car adoption: empirical evidence from India Electric cars have very little market share in developing countries despite their environmental benefits. Thus, governments have started promoting electric cars by providing financial incentives to consumers. The current article aims to examine the direct and indirect effects of government financial incentives on consumer electric car adoption in India.Design/methodology/approachThe study followed a quantitative research method that employed a self-administered survey questionnaire. Structural Equation Modelling and Multi-Group Analysis were followed for data analysis.FindingsThe study revealed that financial incentives have an indirect effect on electric car adoption intention rather than a direct effect. In addition, financial incentives were found to have a direct effect on attitude and Perceived Behavioural Control (PBC). Attitude and PBC positively influenced consumer adoption intention.Practical implicationsThe insights and implications from the present study would help policymakers and marketers to formulate better incentive policies and market strategies to increase consumer acceptance of electric cars in developing countries.Originality/valueThe study contributes to the literature by analysing the underlying mechanism that links government financial incentives to electric car adoption intention. This study also explored the direct effect of financial incentives on attitude and PBC, which are less investigated in electric vehicle literature. In addition, the present article also assessed the moderating role of age in electric car adoption, which has mixed evidence in the literature, and such studies are scarce in the Indian context. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png South Asian Journal of Business Studies Emerald Publishing

Influence of government financial incentives on electric car adoption: empirical evidence from India

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References (88)

Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
2398-628X
DOI
10.1108/sajbs-03-2021-0088
Publisher site
See Article on Publisher Site

Abstract

Electric cars have very little market share in developing countries despite their environmental benefits. Thus, governments have started promoting electric cars by providing financial incentives to consumers. The current article aims to examine the direct and indirect effects of government financial incentives on consumer electric car adoption in India.Design/methodology/approachThe study followed a quantitative research method that employed a self-administered survey questionnaire. Structural Equation Modelling and Multi-Group Analysis were followed for data analysis.FindingsThe study revealed that financial incentives have an indirect effect on electric car adoption intention rather than a direct effect. In addition, financial incentives were found to have a direct effect on attitude and Perceived Behavioural Control (PBC). Attitude and PBC positively influenced consumer adoption intention.Practical implicationsThe insights and implications from the present study would help policymakers and marketers to formulate better incentive policies and market strategies to increase consumer acceptance of electric cars in developing countries.Originality/valueThe study contributes to the literature by analysing the underlying mechanism that links government financial incentives to electric car adoption intention. This study also explored the direct effect of financial incentives on attitude and PBC, which are less investigated in electric vehicle literature. In addition, the present article also assessed the moderating role of age in electric car adoption, which has mixed evidence in the literature, and such studies are scarce in the Indian context.

Journal

South Asian Journal of Business StudiesEmerald Publishing

Published: May 21, 2024

Keywords: Electric car; Adoption intention; Financial incentives; Consumer behaviour

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