Rebound effects of behavioural efficiency improvements in households' energy services consumption in the presence of demand rigidities and habits

Martin Baikowski and Simon Koesler

No 120, CAWM Discussion Papers from University of Münster, Münster Center for Economic Policy (MEP)

Abstract: Changes in energy consumption behaviour of households are recognised as a main contributor to reduced energy demand in developed countries. We investigate the economy-wide impacts of a more efficient electricity consumption behaviour in the presence of demand rigidities and consumption habits. Our findings demonstrate that in the context of energy efficiency improvements in households, taking into account rebound effects is vital, as rebound effects can drastically reduce expected energy savings. We further point out that policies aimed at reducing household energy consumption should always take demand rigidities and consumption habits into account, otherwise rebound effects could be significantly underestimated.

Keywords: rebound; demand rigidities; energy service consumption; consumption habits (search for similar items in EconPapers)
JEL-codes: D13 D58 Q41 Q43 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-ene, nep-ore and nep-reg
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:cawmdp:120

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