Working Paper: NBER ID: w16114
Authors: Lucas W. Davis
Abstract: While public discussion of HR 2454 (the "Waxman Markey" bill) has focused on the cap-andtrade program that would be established for carbon emissions, the bill also includes provisions that would tighten energy efficiency standards for consumer appliances. Supporters argue that appliance standards help address a number of market failures. In particular, many studies have pointed out that landlords may buy cheap inefficient appliances when their tenants pay the utility bill. Although this landlord-tenant problem has been widely discussed in the literature, there is little empirical evidence on the magnitude of the distortion. This paper compares appliance ownership patterns between homeowners and renters using household-level data from the Residential Energy Consumption Survey. The results show that, controlling for household income and other household characteristics, renters are significantly less likely to have energy efficient refrigerators, clothes washers and dishwashers.
Keywords: Energy Efficiency; Landlord-Tenant Problem; Appliance Standards; Carbon Emissions
JEL Codes: D13; L68; Q41; Q54
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Renter status (R21) | Ownership of energy efficient appliances (Q48) |
| Renter status (R21) | Ownership of energy efficient refrigerators (L68) |
| Renter status (R21) | Ownership of energy efficient dishwashers (L68) |
| Ownership of energy efficient appliances (Q48) | Energy consumption (Q41) |
| Energy consumption (Q41) | Carbon emissions (Q54) |