Revisiting the market for lemons: Quality uncertainty in the battery-engine-vehicle era
1 : Maastricht University
2 : Maastricht University
3 : Maastricht University
* : Corresponding author
The rapid electrification of the automotive industry has spurred the growth of The used battery-powered-electric-vehicle (BEV) market. Battery information asymmetry negatively affects this market. BEVs depreciate faster than gasoline but align with diesel vehicles, despite subsidies. Based on a dataset of 18,128 vehicles, we observe higher ask prices for newer vehicles, especially for BEVs. DiD estimates indicate that the penalty for a recall, as negative information shock proxy, is higher for BEVs, yet this might be driven by relatively high catalogue prices. A quasi-natural experiment of tax-burden convergence shows that individuals are primarily driven by usage-cost analysis instead of sustainability.