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IFYEC004 Economics

Coursework

Case Study

UK Government’s Net Zero Carbon Policy and the 2035 Petrol Car Ban

In 2020, the UK government announced that the sale of new petrol and diesel cars would be banned by 2035 as part of its broader strategy to achieve net zero carbon  emissions by 2050. The policy is intended to tackle negative externalities from carbon emissions and air pollution, while promoting cleaner technologies such as electric vehicles (EVs) .

To support the transition, the government has introduced subsidies for EV purchases, subsidies for charging infrastructure, and regulations on car manufacturers’ emissions. At the same time, critics argue that the policy risks increasing costs for consumers, putting pressure on low-income households, and creating adjustment challenges for the automotive industry. It is estimated the UK automotive industry employs around 190,000 people.

As the deadline approaches, debates continue about whether these interventions alone are sufficient to meet environmental goals without creating problems elsewhere across the economy.

Source: Various news reports

Coursework Task

"Can the UK’s ban on petrol and diesel cars by 2035 be considered an effective economic policy for addressing market failure linked to carbon emissions?"

An economic evaluation of the impact of government intervention in the car market on different economic agents.

Candidates may wish to use the following as a guide of indicative areas to explore within their research and in writing their report.

•     Market failure: Consideration of how negative externalities from carbon emissions and air pollution justify government intervention.

•     Policy interventions: Consideration of the effectiveness of alternative government measures

•     Economic implications: Consideration of the potential costs and benefits for different economic agents and society as a whole.

50 marks

To access the full mark range, you should be able to:

•     Demonstrate clear knowledge and understanding of relevant economic concepts.

•     Clearly apply your knowledge to case study.

•     Provide relevant economic analysis with clear chains of reasoning.

•     Provide a balanced evaluation considering different perspectives.

•     Demonstrate effective study skills in the research and presentation of your work.