Template-Type: ReDIF-Paper 1.0
Author-Name: Ioana Bejan
Author-Name-First: Ioana
Author-Name-Last: Bejan
Author-Email: cpz597@alumni.ku.dk
Author-Workplace-Name: Department of Food and Resource Economics, University of Copenhagen
Author-Name: Carsten Lynge Jensen
Author-Name-First: Carsten Lynge
Author-Name-Last: Jensen
Author-Email: clj@ifro.ku.dk
Author-Workplace-Name: Department of Food and Resource Economics, University of Copenhagen
Author-Name: Laura M. Andersen
Author-Name-First: Laura M.
Author-Name-Last: Andersen
Author-Email: lma@ifro.ku.dk
Author-Workplace-Name: Department of Food and Resource Economics, University of Copenhagen
Author-Name: Lars Gårn Hansen
Author-Name-First: Lars Gårn
Author-Name-Last: Hansen
Author-Email: lgh@ifro.ku.dk
Author-Workplace-Name: Department of Food and Resource Economics, University of Copenhagen
Title: The Economic Value of Habits in Household Production – A Field Experiment
Abstract: People are prone to habits but how important are they for economic outcomes? In a randomized field experiment we compare two treatments with identical economic incentives to adjust a range of household production activities. Treatments only differ in the extent to which they allow households to adjust habits relevant for these activities. We utilize smart-metered hourly power consumption to unobtrusively measure treatment effects. We find that preventing habits from being adjusted reduces consumer surplus by 76% suggesting a substantial economic value of habits.
Length: 34 pages
Creation-Date: 2018-01
File-URL: http://okonomi.foi.dk/workingpapers/WPpdf/WP2018/IFRO_WP_2018_01.pdf
File-Format: Application/pdf
Number: 2018/01
Classification-JEL: C93, D12, D90
Keywords: habits, field experiment, household behavior, text messages, electricity use
Handle: RePEc:foi:wpaper:2018_01