Economics Working Papers

Publication Date

12-6-2017

Number

E2e 033

Abstract

This paper provides experimental evidence that behavioral interventions spill over to untreated sectors by altering consumer choice. We use a randomized controlled trial and high-frequency data to test the e ect of social norms messaging about residential water use on electricity consumption. Messaging induces a 1.3 to 2.2% reduction in summertime electricity use. Empirical tests and household survey data support the hypothesis that this nudge alters electricity choices. An engineering simulation suggests that complementarities between appliances that use water and electricity can explain only 26% of the electricity reduction. Incorporating the cross-sectoral spillover increases the cost-e ectiveness of the intervention by 62%.

JEL Classification

C93, D91, L95, Q40

Version History

Original Release Date: December 6, 2017

Departments

Department of Economics, Iowa State University

File Format

application/pdf

Length

50 pages

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