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The Roles of Price and Persuasion on Consumer Behavior: Experimental Evidence from Water Consumption
March 30, 2018 @ 3:30 pm - 5:30 pm
Casey J. Wichman
Resources for the Future
Social comparisons are a popular behavioral nudge to promote conservation of energy and water, partially because raising the price of these resources is politically difficult. Nudges may interact with prevailing prices, however, potentially crowding out intrinsic motivation to conserve or increasing the salience of prices. We investigate the interaction of prices and nudges in two randomized experiments in neighboring water utilities. We find some evidence that higher prices cause social comparisons to generate more conservation but social comparisons do not increase price sensitivity. Our results suggest that consumers may respond to behavioral treatments in part due to private economic benefits, but the predominant conservation motive is behavioral.
Bio: Dr. Casey J. Wichman performs research at the intersection of environmental and public economics, with an emphasis on examining the ways in which individuals make decisions in response to environmental policies using quasi-experimental techniques. In particular, Wichman’s work analyzes the effectiveness of price and non-price interventions for water conservation, the role of information in the design of environmental policy, and the effect of water scarcity in the energy sector.
USC Center for Sustainability Solutions