Working Paper: NBER ID: w22939
Authors: J. Scott Holladay; Jacob Lariviere; David M. Novgorodsky; Michael Price
Abstract: We report the results of a field experiment where we exogenously vary the use of social comparisons "nudges" and subsidies for participation in an in-home energy audit program, and follow subjects through to the subsequent purchase of durable goods. We therefore can compare the causal effect of financial incentives and nudges along two margins, audits, which we liken to search, and purchase of durables. Using data on nearly 100,000 households, we document an asymmetry; nudges increase audits, but lead to lower rates of purchase. We find no evidence of a differential response for those offered a financial incentive. These differences suggest heterogeneity in the motives of the marginal consumer induced by nudges versus prices.
Keywords: energy-efficient durable goods; social comparisons; nudges; financial incentives; in-home energy audits
JEL Codes: C93; D01; D83; Q41
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| nudges (social comparisons) (C92) | likelihood of households participating in an in-home energy audit (IHEA) (R21) |
| nudges (social comparisons) (C92) | search behavior (D83) |
| nudges (social comparisons) (C92) | durable good purchases (L68) |
| financial incentives (subsidies) (H23) | likelihood of households participating in an in-home energy audit (IHEA) (R21) |
| financial incentives (subsidies) (H23) | durable good purchases (L68) |
| search behavior (D83) | durable good purchases (L68) |