Price Knowledge in Household Demand for Utility Services

David Carter and J. Walter Milon

Land Economics, 2005, vol. 81, issue 2

Abstract: A household’s decision to acquire price knowledge is endogenous in the demand for utility services and may affect elasticities and consumption levels. A simultaneous equation model with endogenous switching is developed to evaluate the effects of price knowledge and other sources of heterogeneity. Results indicate informed households were more responsive to average and marginal price signals. Informed households also use less water, but this is due to heterogeneity rather than price knowledge. Controlling for heterogeneity, price knowledge actually increases monthly water usage. The implications of accounting for differences in price knowledge in utility demand modeling and demand management policy are discussed.

JEL-codes: Q21 Q41 (search for similar items in EconPapers)
Date: 2005
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (110)

Downloads: (external link)
http://le.uwpress.org/cgi/reprint/81/2/265
A subscription is required to access pdf files. Pay per article is available.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:uwp:landec:v:81:y:2005:i:2:p265-283

Access Statistics for this article

More articles in Land Economics from University of Wisconsin Press
Bibliographic data for series maintained by ().