The Hidden Cost of Minimum Energy Efficiency Standards

Sébastien Houde and Tobias Wekhof

No 12447, CESifo Working Paper Series from CESifo

Abstract: Minimum standard regulations for energy-using durables have long been suspected of having hidden costs: quality improvements in the regulated dimension reduce quality in other dimensions. We substantiate this claim for the U.S. clothes washer market, which has become a notorious example of the hidden cost phenomenon. We find that overall quality increased from 2001 to 2011, and these gains were primarily driven by improvements in energy efficiency. Quality in the non-energy dimensions declined or remained constant after the major standard change. These hidden costs, however, were quickly offset by energy-efficiency improvements in the new models.

Keywords: minimum quality standard; hidden cost; energy efficiency regulations; appliance market; ex post analysis (search for similar items in EconPapers)
JEL-codes: D12 L51 L68 Q48 Q55 (search for similar items in EconPapers)
Date: 2026
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.ifo.de/DocDL/cesifo1_wp12447.pdf (application/pdf)

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:ces:ceswps:_12447

Access Statistics for this paper

More papers in CESifo Working Paper Series from CESifo Contact information at EDIRC.
Bibliographic data for series maintained by Klaus Wohlrabe ().