http://www.economist.com/news/finance-and-economics/21702762-why-fuel-taxes-are-best-way-encourage-sales-greener-cars-not-easy-being A new paper by Anna Alberini and Markus Bareit compares policy changes in Switzerland’s 26 cantons to changes in new car sales in each area between 2005 and 2011 as a natural experiment. The least efficient policy was the annual rebate for owning a green car. The authors found this was much less effective than raising the annual registration fees on dirty cars, which had the bonus of raising revenues. But even that was inefficient. Every tonne of carbon saved by the purchase of greener cars cost the consumer SFr810 ($815), over seven times the government’s estimate of the economic cost of higher emissions. Higher fuel taxes were more effective: the authors found a 16% increase in petrol duty had the same effect as a 50% increase in registration fees.