Does it matter why power outages occur? An example of information-induced gender-heterogeneous preference on the intensive and extensive margins of choice

Jacob Ladenburg, Kirsten Lund Jensen and Christa Lassen

Applied Economics Letters, 2014, vol. 21, issue 10, 657-664

Abstract: People experience welfare losses in the event of power outages. A higher share of wind power in the power generation mix increases difficulties in forecasting power generation. This, in turn, challenges an effective utilization of wind power and increases the risk of power outages. Using a split sample approach, we test whether private households' preferences for power outages are sensitive to information regarding the positive influence that controlled power outages can have on the utilization of wind energy in particular. Information increases the overall acceptance of contracts with low compensation, but influences females and males differently. Relative to female respondents, information increases male respondents' preferences for accepting a contract, whilst information reduces preferences among females, relative to males, for contracts with higher levels of compensation.

Date: 2014
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DOI: 10.1080/13504851.2014.881963

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