Working Paper: NBER ID: w16732
Authors: Dora L. Costa; Matthew E. Kahn
Abstract: We find that households living in California homes built in the 1960s and 1970s had high electricity consumption in 2000 relative to houses of more recent vintages because the price of electricity at the time of home construction was low. Homes built in the early 1990s had lower electricity consumption than homes of earlier vintages because the price of electricity was higher. The elasticity of the price of electricity at the time of construction was -0.22. As homes built between 1960 and 1989 become a smaller share of the housing stock, average household electricity purchases will fall.
Keywords: electricity consumption; housing; cohort effects
JEL Codes: Q41; Q58
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| price of electricity at the time of construction (L94) | long-term electricity consumption of homes (L94) |
| Homes built in the 1960s and 1970s (R21) | electricity consumption in 2000 (L94) |
| higher electricity prices at the time of construction (L94) | lower electricity consumption (Q41) |
| historical electricity prices (N72) | average household electricity consumption (D10) |
| historical low prices at construction (L74) | less energy efficient homes (Q41) |