Overriding Consumer Preferences with Energy Regulations
W. Kip Viscusi
Vanderbilt University - Law School; National Bureau of Economic Research (NBER); Vanderbilt University - Department of Economics; Vanderbilt University - Owen Graduate School of Management; Vanderbilt University - Strategy and Business Economics
July 17, 2012
Vanderbilt Law and Economics Research Paper No. 12-24
PERC Research Paper No. 12/13
This paper examines the economic justification for recent U.S. energy regulations proposed or enacted by the U.S. Department of Energy, the U.S. Department of Transportation, and the U.S. Environmental Protection Agency. The case studies include mileage requirements for motor vehicles and energy-efficiency standards for clothes dryers, room air conditioners, and light bulbs. The main findings are that the standards have a negligible effect on greenhouse gases and the preponderance of the estimated benefits stems from private benefits to consumers, based on the regulators' presumption of consumer irrationality.
Number of Pages in PDF File: 48
Keywords: energy regulations, cost-benefit analysis, behavioral economics, consumer choice, climate policy, energy efficiency standards
JEL Classification: Q4, Q48, Q5, Q54
Date posted: July 18, 2012 ; Last revised: November 27, 2012
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