Environmental Engineering Reference
In-Depth Information
labels is especially interesting as it is frequently used for durable products such as
domestic appliances, cars, houses, or tyres. The European Comparative Energy Label
is perhaps the most well-known example of this type of labelling.
Although the European energy label has been analysed in many studies, its impact
on consumer behaviour is not widely known. Some studies such as [ 14 , 17 , 18 ] have
analysed the willingness to pay (WTP) of consumers for energy ef
cient refrigerators,
dishwashers and washing machines in the Basque Country, and have obtained own
and price elasticities of demand.
The present chapter seeks to extend this analysis of the WTP for refrigerators,
dishwashers and washing machines to the case of Spain. The aim is to contribute to
the literature with new data that can improve the knowledge about energy ef
ciency
and the European energy label.
The chapter is organised as follows: Sect. 1 deals with the importance of
information problems when promoting energy ef
ciency, and the use of labelling
schemes to address this barrier. Section 2 brie
y discusses the case of energy eco-
labels (endorsement labels) and comparative labels, paying special attention to the
successful case of the European energy label. Section 3 focuses on one important
factor for the success of labelling programmes: consumer
'
s willingness to pay for
labelled goods. The cases of washing machines, dishwashers and refrigerators on
the Spanish market are analysed. For each appliance, WTP is estimated and an
analysis of the price elasticities of demand is included. Elasticity estimates are
needed for the design and implementation of policies such as subsidies or taxes
devoted to encourage the consumption of labelled goods. The
nal section is
devoted to conclusions.
2 Informational Problems and Policies to Address Them
Information problems consist of,
rstly, a lack of information on the part of con-
sumers about the availability of and savings from energy-ef
cient products, which
leads to sub-optimal decisions and under-investment in energy ef
ciency; secondly,
there is the case of asymmetric information, due to manufacturers, retailers and
consumers having access to different levels of information, e.g. on the energy per-
formance of a product, and also having different goals or incentives (known as
'
split
incentives
) or actions which are unobservable, enabling them to act opportunisti-
cally (known as
'
); then there are principal-agent problems, when the
agent that has to make the investment is not the one that uses the product bought, and
thus has an incentive not to invest in an energy-ef
'
moral hazard
'
cient product, as may happen in
the case of landlords and tenants or between different departments within an orga-
nisation and
nally there are externalities related to learning-by-using [ 23 ].
But there are also other behavioural problems which derive from systematic
biases in consumer decision-making. These may cover a wide variety of problems
such as the following:
rst loss aversion, because people tend to value the pain of
potential losses more highly than the bene
t of potential gains [ 26 ], which may lead
Search WWH ::




Custom Search