Public Good vs. Private Gain: Unpacking Willingness to Pay for Programmable Heating Thermostats
Programmable heating thermostats afford households with a low-cost technology to save on their heating bill, but uptake remains rare. Using an incentivized survey experiment with about 10,000 German households, we estimate households' willingness to pay (WTP), with an eye toward identifying whether incomplete information is responsible for the low adoption rate and thus seemingly low valuation of this digital technology. To this end, we randomly provide households with information on either the private or public gains of the thermostats. We find that informing households about the gains from cost savings does not significantly affect WTP. Conversely, informing households about the gains from emission reductions significantly increases average WTP by almost 12\%. Exploratory causal forest estimations indicate several sources of heterogeneity that require qualifying these blanket conclusions. Among respondents treated by private good information, for example, we find positive effects on WTP for those in large households, contrasted by negative effects for those who already perceive their heating behavior as efficient. Taken together, these results suggest that the public good information treatment is more appropriate as a general information strategy, but targeting specific groups and tailoring information to them may increase the positive impact.
United States Association for Energy Economics (USAEE)
JEL-Klassifikation: D12, D83, Q41, Q51
DOI: 10.2139/ssrn.5199328