Nudges and peak pricing: A common pool resource energy conservation experiment

Buckley, Penelope; Llerena, Daniel

doi:10.1016/j.socec.2022.101928

Cited by 4 publications

(2 citation statements)

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“…In addition, this study contributes to the emerging body of literature that studies energy-related behaviour (e.g. Buckley & Llerena, 2018;Casal et al, 2017), and more generally, pro-environmental behaviour (e.g. Blanco et al, 2018;Momsen & Ohndorf, 2020), in laboratory experiments.…”

Section: Introductionmentioning

confidence: 90%

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Energy conservation at home

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The residential sector is the third largest energy consumer among all sectors. Unlike in industrial sectors, energy conservation in the residential sector largely relies on decentralised individual decision-making. Generally speaking, two approaches can enable households to retain a certain level of energy service consumption with less energy input or waste - improving energy efficiency and curtailing energy use. The former approach usually requires an investment in energy-efficiency such as energy-efficient appliances and insulation. However, households may be reluctant to make such investments due to factors such as the high upfront cost, uncertainty regarding the actual benefit, or simply lack of attention to energy efficiency. In terms of the latter approach, although curtailing energy use entail minimal financial costs, it requires considerable effort to acquire knowledge about energy savings, pay adequate attention to domestic energy use, and make persistent habit changes. Therefore, appropriate policy interventions are necessary to encourage household energy conservation. Efforts in designing policy interventions that target home energy conservation have been made over decades. Among other policy instruments, this thesis focuses on the intersection between information-based instruments and behavioural policy interventions, i.e., novel information-based policy instruments that apply behavioural economic insights. Information-based behavioural policy interventions have gained momentum due to their relatively low implementation costs and the ability to target multifarious non-financial motivations and barriers related to energy conservation. Despite the merits of information-based behavioural policy interventions, the effectiveness of this type of policy remains inconclusive. Moreover, previous research into behavioural policy interventions has been criticised for neglecting their heterogeneous effects. Evidence on the treatment effects heterogeneity related to socio-cultural contexts is especially scarce, which may be due to both the complexity of disentangling factors underpinning human behaviours and the costs of conducting large-scale, cross-context RCTs. The overarching goal of this thesis is to better understand the effectiveness of information-based behavioural policy interventions on household energy behaviour. Two specific aims were embodied throughout this thesis. First, this thesis aims to test whether altering specific elements of an intervention can improve its effectiveness by appealing to certain psychological mechanisms. Second, this thesis aims to understand the heterogeneity in intervention effects with respect to contextual factors and culturally-influenced personal traits. To materialise the information-based behavioural policy interventions, two particular interventions were chosen as research objects, i.e., energy labelling and social comparison feedback. Our empirical findings shed light on the effective strategies for communicating energy-related information with consumers, the importance of considering contextual factors and context-determined psychological traits when designing and implementing behavioural interventions, and potential pitfalls in intervention design. This thesis closes with an advocatory note about tailoring the design of behavioural interventions to socio-cultural contexts and consumers with specific psychological antecedents. Given the growing availability of big data and advancements in computational algorithms, the potential of information-based behavioural policy interventions can be further unleashed through customisation, which can ultimately facilitate the energy transition and help achieve global targets to mitigate climate change.

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Section: Introductionmentioning

confidence: 90%

“…In practice, (online) laboratory experiments have also demonstrated their success in replicating the findings on social norms in the field and investigating underlying mechanisms (e.g. Buckley & Llerena, 2018;Goeschl et al, 2018;Raihani & McAuliffe, 2014).…”

Section: Introductionmentioning

confidence: 99%