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- Title
Consumer valuation of energy-saving features of residential air conditioners with hedonic and choice models.
- Authors
Matsumoto, Shigeru
- Abstract
The promotion of energy-efficient appliances is necessary to reduce the energetic and environmental burden of the household sector. However, many studies have reported that a typical consumer underestimates the benefits of energy-saving investment on the purchase of household electric appliances. To analyze this energy-efficiency-gap problem, many scholars have estimated implicit discount rates that consumers use for energy-consuming durables. Although both hedonic and choice models have been used in previous studies, a comparison between the two models has not yet been made. This study uses point-of-sale data about Japanese residential air conditioners and estimates implicit discount rates with both hedonic and choice models. Both models demonstrate that a typical consumer underinvests in energy efficiency. Although choice models generally estimate a lower implicit discount rate than hedonic models, the latter models estimate the values of other product characteristics more consistently than choice models.
- Subjects
ENERGY conservation; AIR conditioning equipment; HEDONISTIC consumption; ENERGY efficiency of household appliances; CASH discounts
- Publication
Empirical Economics, 2018, Vol 55, Issue 4, p1779
- ISSN
0377-7332
- Publication type
Article
- DOI
10.1007/s00181-017-1327-1