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Prices versus nudges: What matters for search versus purchase of energy investments?

J Holladay (), Jacob LaRiviere, David Novgorodsky and Michael Price

Journal of Public Economics, 2019, vol. 172, issue C, 151-173

Abstract: We report the results of a field experiment where we exogenously vary the use of social comparison “nudges” and subsidies for participation in an in-home energy audit program. We follow subjects through to 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 that both prices and nudges cause a statistically significant increase in audits. Comparing point estimates, effective nudges are worth roughly $50–$70. However, we find that neither nudges nor subsidies do not significantly impact installations.

Keywords: Information; Social comparison; Public goods; Durable goods (search for similar items in EconPapers)
JEL-codes: D01 Q41 D83 (search for similar items in EconPapers)
Date: 2019
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Handle: RePEc:eee:pubeco:v:172:y:2019:i:c:p:151-173