Consumer Demand for Green Technology in an Urban Setting: The Case of Chicago Rain Barrels

35 Pages Posted: 29 Jul 2009 Last revised: 25 Mar 2015

See all articles by Amy W. Ando

Amy W. Ando

University of Illinois at Urbana-Champaign - Department of Agricultural and Consumer Economics

Luiz P. Freitas

Industrial Economics, Inc.; University of Illinois at Urbana-Champaign - Department of Agricultural and Consumer Economics; Rochester Institute of Technology (RIT) - Department of Economics

Date Written: July 29, 2009

Abstract

Hydrological disruption and water pollution from urbanization can be reduced if households adopt decentralized stormwater controls. We use spatial data from Chicago’s rain barrel program to explore what factors influence adoption of durable green technology that provides public goods in an urban setting. We find that owner-occupancy is positively correlated with green-technology adoption; rental housing may have inefficiently low levels of adoption due to principal-agent problems. More rain barrels are adopted in places with a high-income ideologically-green population, but we find that rain barrel purchases are not correlated with local levels of flooding. Results indicate that policy makers might increase green-technology adoption by reducing transaction costs and providing education programs.

Keywords: consumer theory, public goods, nonpoint water pollution, stormwater management, principal-agent problem, transaction costs, rain barrels

JEL Classification: H41, Q25, Q53

Suggested Citation

Ando, Amy W. and Freitas, Luiz P., Consumer Demand for Green Technology in an Urban Setting: The Case of Chicago Rain Barrels (July 29, 2009). Available at SSRN: https://ssrn.com/abstract=1440877 or http://dx.doi.org/10.2139/ssrn.1440877

Amy W. Ando (Contact Author)

University of Illinois at Urbana-Champaign - Department of Agricultural and Consumer Economics ( email )

326 Mumford Hall, MC-710
Urbana, IL 61801
United States
217-333-5130 (Phone)
217-333-5538 (Fax)

Luiz P. Freitas

Industrial Economics, Inc. ( email )

United States

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University of Illinois at Urbana-Champaign - Department of Agricultural and Consumer Economics

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Urbana, IL 61801
United States

Rochester Institute of Technology (RIT) - Department of Economics

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Rochester, NY 14623-5604
United States

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