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 effect 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-effectiveness of the intervention by 62%.
C93, D91, L95, Q40
Original Release Date: December 6, 2017
Department of Economics, Iowa State University
Jessoe, Katrina; Lade, Gabriel E.; Loge, Frank; and Spang, Edward, "Spillovers from Behavioral Interventions: Experimental Evidence from Water and Energy Use" (2017). Economics Working Papers: Department of Economics, Iowa State University. E2e 033.