Working Paper: NBER ID: w20870
Authors: Michael Price
Abstract: This article provides an overview of the use of field experiments in energy and resource economics. I concentrate on two areas of study; field experiments that (i) speak to the use of dynamic pricing plans to manage the use of electricity and water and (ii) explore the adoption of energy saving technologies. Viewed in its totality, this work suggests that both neo-classical factors such as prices or search costs and behavioral constructs such as salience or social norms influence the use of energy and water. For academics, the studies reviewed provide a deeper understanding of individual behavior and the factors that drive the private provision of public goods. For policy makers, the studies reviewed provide a blueprint outlining ways to combine insights from neo-classical and behavioral economics to manage energy/water demand and mitigate externalities generated through their use.
Keywords: energy economics; field experiments; dynamic pricing; energy saving technologies; environmental externalities
JEL Codes: D03; D04; D62; D83; H41; Q41; Q48
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Dynamic pricing plans (D49) | electricity consumption (L94) |
| Dynamic pricing plans (D49) | water consumption (Q25) |
| Lower prices (D49) | demand for energy-saving technologies (Q41) |
| Search costs (G19) | adoption of energy-saving technologies (Q52) |
| Moral costs (A13) | adoption of energy-saving technologies (Q52) |
| Financial incentives (M52) | adoption of energy-saving technologies (Q52) |
| Enabling technologies (O30) | effectiveness of dynamic pricing plans (L97) |
| Real-time feedback (C91) | consumer responsiveness to pricing changes (D40) |