On the Predictive Power of Economic Preferences Assessed in the Lab for Environmental Behavior: A Qualitative Synthesis and Meta-Analysis

Abstract

Despite the urgency of environmental challenges, from the overuse of natural resources to climate change, there is insufficient action to address them. Environmental challenges have been described as a perfect storm—they can unfold over long time horizons, often involve risk and uncertainty, and have characteristics of social dilemmas. For these reasons, individual preferences such as discounting, risk aversion, and self-interest have been invoked, in part, to explain the persistence of environmental challenges. The evidence relating these preferences— often assessed with stylized lab experiments—to environmentally-relevant behaviors is mixed. We conduct a systematic literature search (51 papers; N=299 effects) and a meta-analysis (28 papers; N=216 effects) of studies measuring time, risk, and social preferences using stylized elicitation tasks and correlate these with real-world environmental behaviors. Additionally, we examine whether features of lab experiments that have been hypothesized to impact their fidelity with behaviors in the field influence the relationship between lab-assessed preferences and environmental behaviors. Overall, we find a limited relationship between time, risk and social preferences and environmental behaviors. However, we find that prosocial and cooperative preferences predict proenvironmental behaviors, and that preferences are more predictive of field behaviors when lab experiments are contextualized and conducted in more realistic settings.

Keywords: Risk Aversion, Discounting, Cooperation, Sustainable Behaviour, Natural resource management, Meta-Analysis