Government Incentives and Policy Frameworks for Electric Vehicle Adoption: A Global Review

Abstract

Government incentives and policy frameworks have been pivotal in shaping the global trajectory of electric vehicle (EV) adoption, but their design, timing, and national context produce widely varying outcomes. This global review synthesizes evidence on demand-side measures (purchase subsidies, tax credits, registration exemptions), supply-side strategies (manufacturing incentives, local content rules), and system-level instruments (charging infrastructure mandates, low-emission zones, and vehicle standards). Purchase incentives and tax credits have produced strong short-term increases in EV registrations in many markets, yet effectiveness depends on program design, duration, and interactions with complementary policies (e.g., charging rollout and grid readiness) (Martins et al., 2024). Regional policy pathways illustrate contrasts: early, generous subsidies and integrated industrial policy helped China scale production and lower costs, while recent policy recalibrations illustrate the need to shift toward market-stability measures as markets mature (DieselNet, n.d.; IEA, 2024). In the United States, the Inflation Reduction Act’s clean vehicle tax incentives reoriented buyer incentives and domestic supply-chain development goals, introducing complex eligibility rules that shape who benefits and how quickly demand responds (U.S. Treasury, 2023).