2021-05-31-未来能源研究所-收入对汽车需求的影响_来自中国新车市场的证据（英）_39页_818kb

Summary of "The Effect of Income on Vehicle Demand: Evidence from China's New Vehicle Market"

Core Content

This working paper investigates the causal relationship between income and new vehicle demand in China using city-level data from 2005 to 2017. The study highlights the importance of understanding this relationship for accurate projections of future oil consumption and greenhouse gas (GHG) emissions, which are crucial for climate policy planning in China and globally.

Main Findings

• Income Elasticity of New Car Sales: The study estimates an income elasticity of new car sales in China to be approximately 2.5, indicating that a 1% increase in income leads to a 2.5% increase in new car sales.
• Underestimation of Sales and Emissions: Recent forecasts of vehicle sales in China have understated actual sales by 36% and carbon dioxide emissions by 18 million metric tons in 2017.
• Income and Emissions Relationship: The long-run relationship between income and vehicle sales suggests that recent forecasts may underpredict the effect of rising income on emissions by about 26%.
• Implications for Climate Policy: To meet its climate goals, China may need to adopt more aggressive climate policies than previously thought, as income growth has significantly outpaced expectations.

Methodology

• Data Source: The study uses city-level data on new vehicle registrations and income from 2005 to 2017.
• Instrumental Variables Approach: To address endogeneity and measurement error, the authors use a Bartik-style instrumental variable (IV) based on the interaction between a city's education employment in 2004 and China's annual high-technology exports.
• Exclusion Restriction: The instrument is assumed to be uncorrelated with unobserved factors that influence vehicle ownership other than income.
• Robustness Checks: The estimates are robust to alternative functional forms and controls for other socioeconomic variables.

Key Variables and Data

• New Cars Sold: Measured in thousand units, with a mean of 37.9 and a standard deviation of 62.0.
• New Car Expenditure: Measured in billion RMB, with a mean of 5.9 and a standard deviation of 10.5.
• Car Price: Measured in thousand RMB, with a mean of 153.0 and a standard deviation of 27.0.
• Income per Capita: Measured in thousand RMB, with a mean of 41.4 and a standard deviation of 16.3.
• Built-up Area: Measured in square kilometers, with a mean of 121.0 and a standard deviation of 165.2.
• Paved Roads Area: Measured in square kilometers, with a mean of 15.9 and a standard deviation of 21.7.
• Population: Measured in thousand people, with a mean of 4,354.2 and a standard deviation of 3,098.4.
• Buses and Taxis: Measured in thousand units, with buses averaging 1.3 and taxis 3.1.
• Total Retail Expenditure: Measured in billion RMB, with a mean of 73.0 and a standard deviation of 111.0.
• Education Employment Share: Measured as a percentage of total employment in 2004, with a mean of 4.8 and a standard deviation of 4.5.
• National High-Tech Exports: Measured in billion RMB, with a mean of 3,786.0 and a standard deviation of 590.2.

Income Growth Trends

• Convergence Across Quintiles: Income growth was relatively uniform across all city quintiles, with the lowest quintile cities experiencing a 3.64-fold increase in average income between 2005 and 2017, and the highest quintile cities experiencing a 2.51-fold increase.
• Income Quintile Shifts: A significant number of low-income cities in 2005 moved to higher income quintiles in 2017, indicating income convergence.
• Income and Sales Correlation: Sales and income growth were strongly correlated, with low-income cities experiencing faster growth in both income and vehicle sales.

Vehicle Market Trends

• Declining Average Prices: The average new car price declined over the study period, particularly between 2008 and 2016, coinciding with tax policy changes and fuel economy regulations.
• Consistent Price Elasticity: Income did not affect the sales-weighted average price of new vehicles, suggesting that sales of low- and high-price vehicles grew in proportion to income.
• Vehicle Attributes: Average horsepower and weight increased across all quintiles, with temporary declines in 2008 and 2016 aligning with engine tax policy changes.

Contributions to Literature

• Income and Vehicle Demand: The study is the first to estimate the city-level income effect on vehicle demand, providing new insights into the income-vehicle sales relationship in non-OECD countries.
• Income and Emissions: It contributes to the Environmental Kuznets Curve (EKC) literature by showing that income can affect pollution through micro-level household behavior, rather than just macro-level data.
• Climate Policy Implications: The findings suggest that climate policy models may need to be revised to account for underestimated future vehicle ownership and emissions, particularly in non-OECD countries.

Conclusion

The paper concludes that recent projections of vehicle sales and emissions in China may be significantly understated due to underestimated income elasticity. The results imply that China's climate policies must be more aggressive to meet its GHG targets under the Paris Agreement. Additionally, the study emphasizes the importance of using city-level data to better understand income-vehicle demand dynamics in emerging economies.