Impact of Different Carbon Tax Conditions on the Behavioral Strategies of New Energy Vehicle Manufacturers and Governments - A Dynamic Analysis and Simulation Based on Prospect Theory

To cope with the environmental pollution caused by carbon emissions, Western countries, such as Switzerland and Germany, have implemented corporate carbon taxes to reduce carbon emissions and have achieved significant results. As one of the world's most carbon-intensive countries, China must take serious action to limit future emission increases through the implementation of carbon tax policies. This study investigated the evolutionary strategies and mechanisms of the interaction between new energy vehicle manufacturers and local governments under static and dynamic carbon taxes. Based on prospect theory, we constructed evolutionary game models between new energy vehicle manufacturers and local governments under static and dynamic carbon tax mechanisms. This study explored the impact of different initial values on the evolutionary results of the game and the different evolutionary paths of the system under static and dynamic carbon tax mechanisms. The ideal carbon tax starting rate was determined to be 0.15. The results of the theoretical model analysis were simulated to provide a theoretical reference for the establishment of a carbon tax system conducive to low-carbon development. The results of the study were: (1) there were differences in the paths and outcomes of the system's evolution to a stable state under different initial values and combinations of strategies; (2) the dynamic carbon tax mechanism was more favorable for the development of the new energy vehicle industry, and the system had no stable point and equilibrium strategy under the static carbon tax mechanism; and (3) the use of a lower starting rate at the beginning of the carbon tax collection process was helpful in encouraging new energy vehicle firms to select a low-carbon production strategy.