The Habit-Forming Effects of Feedback: Evidence From a Large-Scale Field Experiment

David P. Byrne (), Lorenz Goette (), Leslie A. Martin (), Lucy Delahey, Alana Jones, Amy Miles, Samuel Schob, Thorsten Staake and Verena Tiefenbeck

CRC TR 224 Discussion Paper Series from University of Bonn and University of Mannheim, Germany

Abstract: We provide a unique test of competing models of persistence in behavior. We propose a new attention-based behavioral mechanism for habit formation and contrast its predictions with the Stigler and Becker (1977) consumption-based mechanism. We test both mechanisms using a large-scale field experiment in shower water consumption. Our experiment varies cycles of household-level real-time feedback that temporarily draws attention to individuals’ water consumption. Combining this design with real-time consumption data, we test the mechanism for persistence in behavior that our experiment generates. Our results strongly support a dynamic attention-based model of habit over the workhorse habit stock model used in economics.

Keywords: Habit formation; Attention; Realtime feedback; Water usage; Randomized Control Trial (search for similar items in EconPapers)
JEL-codes: C93 D12 D83 Q25 (search for similar items in EconPapers)
Pages: 48
Date: 2021-04
New Economics Papers: this item is included in nep-exp
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:bon:boncrc:crctr224_2021_285

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