Document Type

Article

Publication Version

Accepted Manuscript

Publication Date

2013

Journal or Book Title

International Journal of Sustainable Economy

Volume

5

Issue

4

First Page

385

Last Page

403

DOI

10.1504/IJSE.2013.056791

Abstract

With the increasing concerns about the petroleum reserve, and the global warming, people have been looking for renewable and environmental friendly energy sources to supplement and replace fossil fuels. Ethanol has been an appropriate substitute to fossil fuels. Currently, E10 and E85 are two of the main transportation fuels with ethanol and they are competing in the market. This study investigates the competition between E10 and E85 with an oligopoly Cournot model and derives three indicators from the equilibrium to measure the performance of the market: E85's market share, E85 price premium which indicate the consumers' additional willingness to pay, and the social welfare which indicates the societal wellbeing from the products. The authors also studied how the government policies impact the market equilibrium, how the industry size affects the market performance of E85, and whether E85 has a bright prospect with the increase of FFVs number. The results not only provide some prospects of E85, but also benefit the policy makers by quantitatively showing the effectiveness of tax credits and other government policies to promote the ethanol industry

Comments

This is a manuscript of an article from International Journal of Sustainable Economy 5 (2013): 385, doi: 10.1504/IJSE.2013.056791. Posted with permission.

Copyright Owner

Inderscience Publishers

Language

en

File Format

application/pdf

Published Version

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