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Feedback and consumption behavior

Author

Listed:
  • Sandro Casal
  • Nives Della Valle
  • Luigi Mittone
  • Ivan Soraperra

Abstract

Field studies suggest that feedback is an effective tool for promoting efficient consumption. Feedback enhances consumers� awareness of the consequences associated with consumption of those goods, such as energy, that are usually consumed indirectly and unconsciously. Yet, variations in methodologies and weaknesses of internal control in the literature studying the effect of feedback on efficient consumption make it difficult to draw general conclusions. Our study aims to isolate the mechanisms underlying the effect of feedback on consumption in a controlled environment with a neutral language. We design a laboratory experiment in which individuals are not aware of the consequences of their consumption decisions and, thus, cannot easily identify the optimal ones. We introduce feedback as a mechanism to enhance awareness of consumption consequences. We assess the efficacy of different types of feedback that include descriptive norms and framing effects to enhance search of optimal consumption. We find that feedback is most effective when we introduce a negative frame. On the contrary, feedback reduces efficiency when we introduce information about peers� inefficient behavior. Our study quantifies the effect of different types of feedback and suggests useful insights for policy makers.

Suggested Citation

  • Sandro Casal & Nives Della Valle & Luigi Mittone & Ivan Soraperra, 2016. "Feedback and consumption behavior," CEEL Working Papers 1608, Cognitive and Experimental Economics Laboratory, Department of Economics, University of Trento, Italia.
    • Handle: RePEc:trn:utwpce:1608
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    File URL: http://www-ceel.economia.unitn.it/papers/papero16_08.pdf
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    More about this item

    Keywords

    Feedback; Consumption; Laboratory Experiment;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices

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