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Exploring the Spatial Heterogeneity of Individual Preferences for Ambient Heating Systems

Cristiano Franceschinis, Riccardo Scarpa (), Mara Thiene (), John Rose, Michele Moretto and Raffaele Cavalli ()
Additional contact information
Riccardo Scarpa: Durham University Business School, Durham University, DH1 3LB Durham, UK
Mara Thiene: Department of Land, Environment, Agriculture and Forestry, University of Padova, 35122 Padova, Italy
John Rose: Institute for Choice, University of South Australia, SA 5001 Adelaide, Australia
Raffaele Cavalli: Department of Land, Environment, Agriculture and Forestry, University of Padova, 35122 Padova, Italy

Energies, 2016, vol. 9, issue 6, 1-19

Abstract: The estimation and policy use of spatially explicit discrete choice models has yet to receive serious attention from practitioners. In this study we aim to analyze how geographical variables influence individuals’ sensitivity to key features of heating systems, namely investment cost and CO 2 emissions. This is of particular policy interest as heating systems are strongly connected to two major current environmental issues: emissions of pollutants and increased use of renewable resources. We estimate a mixed logit model (MXL) to spatially characterize preference heterogeneity in the mountainous North East of Italy. Our results show that geographical variables are significant sources of variation of individual’s sensitivity to the investigated attributes of the system. We generate maps to show how the willingness to pay to avoid CO 2 emissions varies across the region and to validate our estimates ex-post . We discuss why this could be a promising approach to inform applied policy decisions.

Keywords: mixed logit model; spatial variables; ambient heating systems choices; willingness to pay (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2016
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