Energy Use and Temperature Habituation: Evidence from High Frequency Thermostat Usage Data

19 Pages Posted: 27 Feb 2019

See all articles by Qi Ge

Qi Ge

Vassar College - Department of Economics

Benjamin Ho

Vassar College

Date Written: April 2019

Abstract

Using micro‐level thermostat data from 27,000 U.S. households, we analyze how home heating/cooling decisions respond to weather. Responses are greater for extreme heat than for extreme cold and persist for at least 30 days after exposure, due in part to transaction costs but also to changes in intrinsic preferences. Failure to understand habit can lead us to overestimate the impact of short‐term policy nudges but underestimate the long‐run impact of small changes. Higher frequency estimates of how behavior responds to weather improve our understanding of climate adaptation as climate change affects not only mean temperatures but also variances.

JEL Classification: C55, D03, Q4

Suggested Citation

Ge, Qi and Ho, Benjamin, Energy Use and Temperature Habituation: Evidence from High Frequency Thermostat Usage Data (April 2019). Economic Inquiry, Vol. 57, Issue 2, pp. 1196-1214, 2019, Available at SSRN: https://ssrn.com/abstract=3342652 or http://dx.doi.org/10.1111/ecin.12744

Qi Ge (Contact Author)

Vassar College - Department of Economics ( email )

124 Raymond Avenue
Poughkeepsie, NY 12604
United States

Benjamin Ho

Vassar College ( email )

124 Raymond Avenue
Poughkeepsie, NY 12604
United States

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