Calibrating fiscal policy signals for ammonia fuel adoption in shipping

Ammonia is a promising zero-carbon shipping fuel, yet uptake remains sluggish. This study calibrates budget-constrained fiscal instruments to promote shipowner adoption and sustain diffusion while ensuring supplier profitability, supply stability, and government payoff. We develop a two-layer Stackelberg model with the government as leader and shipowners and fuel suppliers as followers. In the static layer, the optimum is identified by gridding tax and subsidy; in the dynamic layer, ODEs track 100-month trajectories. Results show an interior optimum within the fiscal corridor at 99 , 79 , delivering 99.996 % static adoption, an equilibrium price of USD 1 , 080 / t , and about 87.06 % penetration. Dynamics converge stably, with learning-driven price declines and rising composite government utility. The optimum serves as a policy anchor: maintain the carbon tax as a long-run signal and front-load then phase down the subsidy as adoption increases. Within the corridor, fiscal parameters are adaptively adjusted to observed adoption, profitability, and net fiscal burden.