The Persistence of Treatment Effects with Norm-Based Policy Instruments: Evidence from a Randomized Environmental Policy Experiment

Posted: 7 Jun 2011

See all articles by Paul J. Ferraro

Paul J. Ferraro

Johns Hopkins University - Carey Business School; Georgia State University - Department of Economics

Juan Jose Miranda

World Bank

Michael K. Price

University of Tennessee, Knoxville

Abstract

Policymakers increasingly use norm-based messages to promote conservation efforts. Despite the apparent success of such strategies, empirical analyses have thus far focused exclusively on short-run effects. From a policy perspective, however, whether and how such strategies influence behavior in the long-run is of equal interest. We partner with a metropolitan water utility to implement a natural field experiment examining the effect of such messages on longer-run patterns of water use. Empirical results are striking. While appeals to pro-social preferences affect short-run patterns of water use, only messages augmented with social comparisons have a lasting impact on water demand.

Keywords: Social norms, natural field experiment, water demand

JEL Classification: D03, C93, L95, Q21

Suggested Citation

Ferraro, Paul J. and Miranda, Juan Jose and Price, Michael K., The Persistence of Treatment Effects with Norm-Based Policy Instruments: Evidence from a Randomized Environmental Policy Experiment. American Economic Review, Vol. 101, No. 3, 2011. Available at SSRN: https://ssrn.com/abstract=1859104

Paul J. Ferraro (Contact Author)

Johns Hopkins University - Carey Business School ( email )

100 International Drive
Baltimore, MD 21202
United States

Georgia State University - Department of Economics ( email )

P.O. Box 3992
Atlanta, GA 30302-3992
United States

Juan Jose Miranda

World Bank ( email )

1818 H Street NW
Washington, DC 20433
United States

Michael K. Price

University of Tennessee, Knoxville ( email )

The Boyd Center for Business and Economic Research
Knoxville, TN 37996
United States

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