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Better energy cost information changes household property investment decisions: Evidence from a nationwide experiment

Author

Listed:
  • Carroll, James
  • Denny, Eleanor
  • Lyons, Ronan C.
  • Petrov, Ivan

Abstract

With buildings accounting for roughly 40 % of energy consumption in the US and Europe, energy efficiency upgrades will be central in meeting climate targets. Using a nationwide controlled field experiment, we find that the inclusion of property-specific energy cost labels within property advertisements increases energy efficiency premiums. We also show that more energy efficient properties sell faster and, for the first time, that energy cost labels shortened time-to-sell. While a major departure from existing property labelling policy, these results suggest that framing property energy efficiency according to their cost implications, rather than in energy units, increases the demand for energy efficiency.

Suggested Citation

  • Carroll, James & Denny, Eleanor & Lyons, Ronan C. & Petrov, Ivan, 2024. "Better energy cost information changes household property investment decisions: Evidence from a nationwide experiment," Energy Economics, Elsevier, vol. 139(C).
    • Handle: RePEc:eee:eneeco:v:139:y:2024:i:c:s0140988324006170
    DOI: 10.1016/j.eneco.2024.107909
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    More about this item

    Keywords

    Housing demand; Energy efficiency; Energy policy; Imperfect information; Framing; Field experiment;
    All these keywords.

    JEL classification:

    • R21 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Housing Demand
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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