Green Spills: Peer Effects in Pro-environmental Behaviors

60 Pages Posted: 17 Nov 2023

Date Written: October 20, 2023

Abstract

This paper studies causal peer effects in pro-environmental behavior using geocoded panel data of 260,000 Swiss households (2008-2019) and instrumental variables methods. Peer behavior has a simultaneous impact on a broad spectrum of energy practices, and manifests itself in different ways contingent upon households' constraints. For instance, we find that solar PV adoption increases neighbors' electricity conservation efforts. This has important implications for renewable energy subsidy evaluation. Back-of-the-envelope calculation suggests that accounting for peer effects decreases carbon abatement costs of solar PV subsidies by 20 percent.

Keywords: Peer influence, social norm, energy conservation, climate change mitigation, abatement costs

JEL Classification: D90; H23; Q40; R22

Suggested Citation

Bigler, Patrick and Janzen, Benedikt, Green Spills: Peer Effects in Pro-environmental Behaviors (October 20, 2023). Available at SSRN: https://ssrn.com/abstract=4608076 or http://dx.doi.org/10.2139/ssrn.4608076

Patrick Bigler

University of Bern ( email )

Gesellschaftsstrasse 49
Bern, BERN 3001
Switzerland

Benedikt Janzen (Contact Author)

University of Bern ( email )

Gesellschaftsstrasse 49
Bern, BERN 3001
Switzerland

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