Should local governments adopt dynamic subsidy mechanism to promote the development of green intelligent buildings? An evolutionary game analysis.

ABSTRACT

The promotion of green intelligent buildings (GIBs) is regarded as an effective way to reduce carbon emissions and environmental pollution. How to formulate a reasonable and practical subsidy mechanism is crucial to promote the development of GIBs. However, there is still a lack of research on dynamic subsidy mechanism. To solve the research gap, based on consumer utility maximization theory, combining Hotelling model, the paper constructs an evolutionary game model between local governments and developers, and discusses the decision-making and evolutionary stable strategy (ESS) of both players under the dynamic subsidy mechanism. In addition, the paper defines a symbol event and analyzes in depth the possibility of effective diffusion of GIBs. Finally, the paper provides corresponding policy suggestions and draws the following conclusions: (1) ESS exists only after the introduction of dynamic subsidy mechanism, so it is necessary for local governments to formulate dynamic subsidy policies; (2) Under the dynamic subsidy mechanism, different subsidy adjustment rates will affect the evolutionary efficiency of the system; (3) The sensitivity of influence factors from high to low is as follows subsidy adjustment rate, financial incentives for consumers, additional taxes for conventional buildings developers, carbon trading income for GIB developers and comprehensive residential benefits for GIB homebuyers. Improving these factors can increase the possibility of effective diffusion of GIBs.