Are Energy-Vulnerable Households More Prone to Informative, Market, and Behavioral Biases?

Christina Kaliampakou, Lefkothea Papada and Dimitris Damigos
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Christina Kaliampakou: Lab of Mining and Environmental Technology, School of Mining and metallurgical Engineering, Zografou Campus, National Technical University of Athens, 15780 Athens, Greece
Lefkothea Papada: Lab of Mining and Environmental Technology, School of Mining and metallurgical Engineering, Zografou Campus, National Technical University of Athens, 15780 Athens, Greece
Dimitris Damigos: Lab of Mining and Environmental Technology, School of Mining and metallurgical Engineering, Zografou Campus, National Technical University of Athens, 15780 Athens, Greece

Societies, 2021, vol. 11, issue 4, 1-22

Abstract: The present paper focuses primarily on investigating whether energy-vulnerable households are more prone to informative, market, and behavioral biases. In this direction, a stated preference approach was used to elicit information about human behavior and cognitive barriers in the context of energy poverty based on both subjective and objective indicators. For the purposes of the survey, a questionnaire was developed that included around 40 questions about housing conditions and information, market, and behavioral barriers related to energy efficiency, energy vulnerability, etc., and specific survey hypotheses were tested employing non-parametric tests. The survey was carried out between November 2020 and January 2021 involving residents of Metsovo, a mountain settlement in Greece. In total, 303 participants took place in the survey through personal interviews, which were conducted remotely due to the COVID-19 pandemic-related distancing measures, using a video platform. The analysis shows that households that face thermal discomfort or are in arrears on energy bills seem to be more prone to certain behavioral and other biases. This conclusion is not confirmed for households that face condensation, mold and damp problems or are classified as energy-poor under the “ten percent rule”. The main conclusion drawn is that the income status of the household plays a greater role compared to its classification as energy vulnerable. Nevertheless, the findings of the study need to be confirmed by future research, because the research specifically on how energy poverty affects people’s decision making is extremely limited. In any case, the results are worrisome and illustrate the need for more effective energy poverty policies that will take into account the effects of scarcity on household decision making.

Keywords: energy poverty; behavioral biases; energy and investment illiteracy; present bias (search for similar items in EconPapers)
JEL-codes: A13 A14 P P0 P1 P2 P3 P4 P5 Z1 (search for similar items in EconPapers)
Date: 2021
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