Durable Goods and Residential Demand for Energy and Water: Evidence from a Field Trial
Posted: 9 Jun 2011
Date Written: 2008
This article describes a household production model in which energy-efficient durable goods cost less to operate so households may use them more. The model is estimated using household level data from afield trial in which participants received high-efficiency clothes washers free of charge. The estimation strategy exploits this quasi-random replacement of washers to derive precise estimates of the household production technology and a demand function for clothes washing. During the field trial, households increased clothes washing on average by 5.6% after receiving a high-efficiency washer, implying a price elasticity of -.06. The complete model is used to evaluate the cost-effectiveness of recent changes in minimum efficiency standards for clothes washers.
Keywords: Durable Goods, Household Production, Energy Efficiency, Climate Change
JEL Classification: D13, H23, Q25, Q41
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