the energy ladder theoretical myth or empirical truth results from a meta analysis abstract modern fuels are an important enabler of social and economic development still over 2 billion people rely on traditional biomass for their daily energy needs to overcome the negative effects of traditional energy on human health and the environment and to enhance the livelihood conditions of the poor a transition towards cleaner and more efficient forms of energy is needed understanding household fuel choice and fuel switching behaviour is of vital importance in search for policies to support such a transition process this paper adds to the existing energy transition literature in two ways first we provide a novel conceptual framework to analyze the decision environment underlying energy and fuel choices second we apply this framework in a meta analysis of existing choice models investigating energy switching and stacking behaviour in urban and rural areas in developing countries the meta analysis shows that socio economic household characteristics appear to receive most attention so far in identifying groups of fuel users while relatively little information is available on the impact of the external decision context on household energy choices

stacking up the ladder a panel data analysis of tanzanian household energy choices energy use statistics in tanzania reflect the country s low level of industrialization and development in 2016 only 16 9 of rural and 65 3 of urban inhabitants in mainland tanzania were connected to some form of electricity we use a nationally representative three wave panel dataset 2008 2013 to contribute to the literature on household energy use decisions in tanzania in the context of the stacking and energy ladder hypotheses we firstly adopt a panel multinomial logit approach to model the determinants of household cooking and lighting fuel choices secondly we focus explicitly on energy stacking behaviour proposing various ways of measuring what is inferred when stacking behaviour is thought of in the context of the energy transition and presenting household level correlates of energy stacking behaviour thirdly since fuel uses have gender differentiated impacts we investigate women s bargaining power in the decision making process of household fuel choices we find that whilst higher household incomes are strongly associated with a transition towards the adoption of more modern fuels especially lighting fuels this transition takes place in a context of significant fuel stacking in tanzania government policy has been aimed mostly at connecting households to the electric grid however the public health environmental and social benefits of access to modern energy sources are likely to be diminished in a context of significant fuel stacking lastly we present evidence that the educational attainment of women in the household is an important aspect of household fuel choices

buyer initiated vs seller initiated information revelation sales presentations are the core of the selling process where salespeople provide information to prospects one challenge is that the amount of information available to be potentially communicated may exceed salespeople s ability to communicate or customers ability to process there is limited bandwidth between the firm and customers one important decision then is which information should customers see what the firm chooses to tell customers may be informative in itself when constrained to a seller initiated information revelation format where the firm chooses which feature to show the firm never finds it optimal to offer more features than it is able to inform customers about consequently customers never find credible a claim that the product has all features the important implication is that price alone cannot serve as a signal of quality in this setting in contrast a buyer initiated information revelation format where customers decide which information to receive increases the probability of a sale and also results in the production of higher quality products in a competitive setting by adopting buyer initiated information revelation firms are able to attain positive profits this is due to the fact that customers infer the product s quality from the price along with the information revelation format customers know that at some prices firms find it profitable to produce high quality products and at other lower prices this is not the case thus customer empowerment leads to higher profits

cost benefit assessment of energy efficiency investments accounting for future resources savings and risks in the australian residential sector this article focuses on the impact of the discount rate on cost benefit assessment of investment options for residential building efficiency an integrated thermal modeling life cycle costing approach is applied to an extensive sample of dominant house designs for australian conditions the relative significance of predicted thermal performance and the applied discount rate on the present value of energy savings from alternative investment scenarios is investigated costs and benefits are also evaluated at the economy wide scale including carbon pricing considerations and for a test case household faced with alternative investment options at the point of construction the influence of the applied discount rate on produced cost benefit calculations is investigated as is the interaction between critical cost benefit input parameters findings support that the discounting framework is the primary driver of difference in estimates about costs and benefits of higher standards of efficiency in the residential sector results demonstrate that agreement on a low discount rate based on sustainability principals would prioritise those projects with significant environmental benefits

media markets and localism does local news en espanol boost hispanic voter turnout the same time the availability of these products reduces the consumption of local news not only because some consumers prefer national and global content to local information but also because local media products that lose a significant number of consumers are forced to cut qual ity and they may even cease to exist if their audience falls below a critical threshold for these reasons some scholars claim that the rise of integrated media markets undermines local civic engagement robert d putnam 2000 against this backdrop many regulatory agencies including the federal communications commission fcc of the united states seek to protect local media and promote localism for instance by limiting ownership concentration 1 however localism is desirable only if there are in fact positive spillovers from the provision of local content that can help justify the loss of private welfare that integrated media markets would provide in this paper we propose a simple test for the existence of spillovers from local news pro gramming asking if the presence of local television news affects civic behavior the ubiq uity of local news programming across all us metro areas makes it impossible to study its effects on the general population in contrast the availability of spanish language news has increased considerably in recent years providing us with an experiment to study the effect of local news on one important measure of civic engagement voter turnout in local elections in particular we use a differencing approach asking whether hispanic voter turnout is higher in relation to non hispanic turnout in metro areas with spanish language local television news our results indicate that spanish language local television news raises hispanic turnout by more than 4 percentage points local news targeted at hispanics has no effect on the participa tion of non hispanics and as one would expect a significantly smaller effect in years with a presidential race in markets with spanish language news about a quarter of hispanics turn to these programs our estimates thus imply that news in spanish caused about a fifth of spanish language news viewers to start voting interestingly hispanics with access to news in spanish do not increase the time they spend watching news content analyses of spanish language news programs in the united states find that these shows are much more likely to report on

energy transition poverty and inequality in vietnam this paper investigates energy transition energy poverty and energy inequality in vietnam employing a longitudinal dataset of a nationally representative household survey we use the data on residential energy expenditure of more than 9 000 households over the period 2004 2016 we find a transition from traditional energy to modern energy but this transition varies across regions between ethnic and welfare groups and between rural and urban population the poor and ethnic minority households still rely heavily on traditional energy sources such as coal and biomass to meet their energy demands electricity poverty has decreased but energy cost poverty has increased in addition energy inequality tends to decrease at a more significant rate than income and consumption inequalities we propose a national program for energy poverty alleviation be established to devise policies to lower households energy costs further assistance to the poor and ethnic minority households is also recommended so that they can afford a higher level of electricity consumption

transparency and economic policy we provide a two period model of political competition in which voters imperfectly observe the electoral promises made to other voters imperfect observability generates an incentive for candidates to offer excessive transfers even if voters are homogeneous and taxation is distortionary government spending is larger than in a world of perfect observability transfers are partly financed through government debt and the size of the debt is higher in less transparent political systems the model provides an explanation of fiscal churning it also predicts that groups whose transfers are less visible to others receive higher transfers and that imperfect transparency of transfers may lead to underprovision of public goods from the policy perspective the main novelty of our analysis is a separate evaluation of the transparency of spending and the transparency of revenues we show that the transparency of the political system does not unambiguously improve efficiency transparency of spending is beneficial but transparency of revenues can be counterproductive because it endogenously leads to increased wasteful spending

market barriers to energy efficiency abstract discussions of energy policy in an environmentally constrained world often focus on the use of tax instruments to internalize the external effects of energy utilization or achieve specified reductions in energy use in the most cost effective manner a substantial literature suggests however that significant opportunities exist to reduce energy utilization by implementing technologies that are cost effective under prevailing economic conditions but that are not fully implemented by existing market institutions this paper examines the theory of the market for energy using equipment showing that problems of imperfect information and transaction costs may bias rational consumers to purchase devices that use more energy than those that would be selected by a well informed social planner guided by the criterion of economic efficiency consumers must base their purchase decisions on observed prices and expectations of post purchase equipment performance if it is difficult or costly for individuals to form accurate and precise expectations the level of energy efficiency achieved by competitive markets will vary from the socially efficient outcome such market barriers suggest a role for regulatory intervention to improve market performance at prevailing energy prices

content vs advertising the impact of competition on media firm strategy media firms compete in two connected markets they face rivalry for the sale of content to consumers and at the same time they compete for advertisers seeking access to the attention of these consumers we explore the implications of such two sided competition on the actions and source of profits of media firms one main conclusion we reach is that media firms may charge higher content prices in a duopoly than in a monopoly this happens because competition for advertisers can reduce the return per customer impression from the ad market making each firm less willing to underprice content to increase demand greater competitive intensity may thus increase content profits and decrease ad profits these findings are in sharp contrast to those in a regular one sided product market in which competition typically lowers product prices and profits we extend the framework to examine competition across different media e g between magazines and cable tv and show that firms in a duopolistic medium may benefit from more intense competition from a monopolist in another medium we characterize the conditions for each firm in the duopoly medium to bundle more ads and earn greater total profits than the rival firm in the monopoly medium

modeling household cooking fuel choice a panel multinomial logit approach we use three rounds of a rich panel data set to investigate the determinants of household cooking fuel choice and energy transition in urban ethiopia we observe that the expected energy transition did not occur following economic growth in ethiopia during the decade 20002009 regression results from a random eects multinomial logit model suggest that households economic status price of alternative energy sources and education are important determinants of fuel choice in urban ethiopia the results also suggest the use of multiple fuels or fuel stacking behavior by households we argue that policy makers could target these policy levers to encourage transition to cleaner energy sources

country level analysis of household fuel transitions abstract solid fuel combustion remains a dominant energy source for household heating and cooking in less developed countries as a result almost three billion people are exposed to household air pollution causing four million premature deaths annually primarily among poor women and children we analyze data from demographic and health surveys in 69 countries to identify determinants of transition from solid to cleaner fuel estimates from a population averaged linear model show that population density and size rural population share income inequality and charcoal production are positively associated with countries solid fuel use while gdp per capita electricity and natural gas production have the opposite effect economic development measured as gdp per capita has the strongest link to solid fuel use a standard deviation increase in per capita gdp above its mean reduces solid fuel use from 70 to 57 of households electricity production is another strong predictor solid fuel use drops by 11 when electricity production increases by one standard deviation above the mean in addition in a fixed effects linear model population size has a positive association with solid fuel use while increases in gdp per capita and the number of governments renewable energy incentives are associated with lower dependence on solid fuels

normal markets market imperfections and energy efficiency abstract the conventional distinction between economic and engineering approaches to energy analysis obscures key methodological issues concerning the measurement of the costs and benefits of policies to promote the adoption of energy efficient technologies the engineering approach is in fact based upon firm economic foundations the principle of lifecycle cost minimization that arises directly from the theory of rational investment thus evidence that so called market barriers impede the adoption of cost effective energy efficient technologies implies the existence of market failures as defined in the context of microeconomic theory problems of imperfect information and bounded rationality on the part of consumers for example may lead real world outcomes to deviate from the dictates of efficient resource allocation a widely held contrary view that the engineering view lacks economic justification is based on the fallacy that markets are normally efficient

the principle of minimum differentiation holds under sufficient heterogeneity the so called principle of minimum differentiation stated by hotelling has been challenged by many authors this paper restores the principle by showing that n firms locate at the center of the market and charge prices higher than the marginal cost of production when heterogeneity in consumers tastes is large enough

fuel choices for cooking in china analysis based on multinomial logit model abstract ensuring household access to affordable reliable sustainable and modern energy for all the people is one of the 17 united nations sustainable development goals sdgs china has achieved 100 electricity access while the traditional solid fuels such as firewood are still widely used in its rural area this paper using a long term and large micro dataset and multinomial logit model investigates quantitatively the determinants of cooking fuel choice in rural china the results show that in addition to the previous knowledge on household income occupation is crucial to the cooking fuel transition in average if the head of household changes its occupation from farm to non farm the possibility of using firewood would reduce by around 14 21 the impact of income is slightly small a 10 increase in income may result in 0 5 of possibility of firewood use these conclusions are robust after considering the possible energy ladders using ordered logit regressions olr and generalized olr after controlling other factors such as income and occupation we have not found concrete evidence on the influences of education and gender of the household head and household member numbers to accelerate the fuel transition in addition to increase the household income the government should pay attention to create more non farm work opportunities for the rural

market provision of broadcasting a welfare analysis this paper presents a theory of the market provision of broadcasting and uses it to address the nature of market failure in the industry advertising levels may be too low or too high depending on the nuisance cost to viewers the substitutability of programs and the expected benefits to advertisers from contacting viewers market provision may allocate too few or too many resources to programming and these resources may be used to produce programs of the wrong type monopoly ownership may produce higher social surplus than competitive ownership and the ability to price programming may reduce social surplus

energy conservation investment do consumers discount the future correctly we argue that the apparently high discount rates attributed to investors making energy conservation investments are not irrational or the result of some market failure rather they may result from an investor recognizing that many conservation investments entail substantial sunk costs in the presence of these costs and uncertainty over future conservation savings consumers should use a higher hurdle rate for investment than if there were no uncertainty simulations suggest that the hurdle rate should be about four times greater than the standard rate an implication of our model is that tax subsidies for the purchase of conservation capital are likely to be ineffective we discuss alternative policy approaches which are more likely to increase energy efficient investment namely mandatory efficiency standards and energy taxes

from linear fuel switching to multiple cooking strategies a critique and alternative to the energy ladder model abstract promoting sustainable development requires evaluating the technical and policy options that will facilitate the adoption and use of energy efficient and less polluting cooking stoves and practices the transition from traditional to modern fuels and devices has been explained by the energy ladder model that suggests that with increasing affluence a progression is expected from traditional biomass fuels to more advanced and less polluting fuels in this paper we evaluate the energy ladder model utilizing data from a four year 1992 96 case study of a village in mexico and from a large scale survey from four states of mexico we show that an alternate multiple fuel model of stove and fuel management based on the observed pattern of household accumulation of energy options rather than the simple progression depicted in the traditional energy ladder scenario more accurately depicts cooking fuel use patterns in rural households the multiple fuel model integrates four factors demonstrated to be essential in household decision making under conditions of resource scarcity or uncertainty a economics of fuel and stove type and access conditions to fuels b technical characteristics of cookstoves and cooking practices c cultural preferences and d health impacts this model also allows better estimates of the expected fuelwood demand and indoor air pollution in rural households

modeling energy technology choices which investment analysis tools are appropriate abstract a variety of tools from modern investment theory appear to hold promise for unraveling observed energy technology investment behavior that often appears anomalous when analyzed using traditional investment analysis methods this paper reviews the assumptions and important insights of the investment theories most commonly suggested as candidates for explaining the apparent energy technology investment paradox the applicability of each theory is considered in the light of important aspects of energy technology investment problems such as sunk costs uncertainty and imperfect information the theories addressed include the capital asset pricing model the arbitrage pricing theory and the theory of irreversible investment enhanced net present value methods are also considered the relevance of the capital asset pricing model and the arbitrage pricing theory given the special characteristics of energy technology investment decisions appears limited to the value of the theories conceptual insights in contrast the theory of irreversible investment and enhanced net present value are found to provide more useful modeling and analysis methods each capable of providing important insights into the energy technology investment paradox

persistent media bias abstract the news media plays an essential role in society but surveys indicate that the public views the media as biased this paper presents a theory of media bias that originates with private information obtained by journalists through their investigations and persists despite profit maximizing news organizations and rivalry from other news organizations bias has two effects on the demand for news first rational individuals are more skeptical of potentially biased news and thus rely less on it in their decision making this skepticism reduces demand and leads the news organization to set a lower price for its publication the greater is the bias it tolerates lower quality news thus commands a lower price second bias makes certain stories more likely than others given their private information journalists may bias their stories if their career prospects can be advanced by being published on the front page news organizations can control bias by restricting the discretion allowed to journalists but granting discretion and tolerating bias can increase profits if it allows journalists to be hired at a lower wage bias is not driven from the market by a rival news organization nor by a news organization with an opposing bias and the profits of a high bias news organization can be higher than the profits of a low bias one moreover bias can be greater with competition than with a monopoly news organization if individuals collectively choose regulation in place of their individual decision making bias increases the expected stringency of regulation

strategic disclosure of research results the cost of proving your honesty in situations where a biased sender provides verifiable information to a receiver i study how strategic reporting affects the incentives to search for information research provides series of signals that can be used selectively in reporting i show that the sender is strictly worse off when his research effort is not observed by the receiver he has to conduct more research than in the observable case and in equilibrium discloses all the information he obtained however this extra research can be socially beneficial and mandatory disclosure of results can thus be welfare reducing finally i identify cases where the sender withholds evidence and for which mandatory disclosure rules become more attractive in 2002 editors of eleven of the most prestigious medical journals announced that they would only publish the results of studies that were entered at their start in a publicly available database 1 pharmaceutical firms conduct clinical trials to test the efficacy and potential side effects of their drugs and to compare them to competitors products publishing results of studies is an efficient way to influence doctors prescriptions and patients tastes however firms can conduct multiple trials and select the most favourable results the system of mandatory disclosure adopted by medical journals is a response to the fear of such selective publishing 2 it makes the research effort of pharmaceutical firms more observable and will influence both the information they disclose and the amount of research they perform in the present article i study the interaction between the research and disclosure decisions which is an essential element in many settings the adoption of mandatory disclosure rules has subtle effects and i discover that leaving the research effort unobservable can sometimes be socially beneficial 3 i study the interaction between research and disclosure in a model where a biased sender searches for information and communicates it strategically to a receiver who will

preferences for domestic fuel analysis with socio economic factors and rankings in kolkata india abstract the choice of domestic fuel is a matter of great concern for households and policy makers in india this paper investigates the demand for domestic fuels when households face four choices fuelwood coal kerosene and lpg the study is based on a survey of 500 households in kolkata india the demand estimates are conducted using a two stage process where the first stage investigates choice and the second the quantity used determinants of fuel demand are identified and their relative importance shown extending the study the paper also analyses the choice of the main cooking fuel in terms of the households stated rankings of six fuels for five attributes the policy discussion indicates that subsidies have less potential to reduce polluting fuels such as coal and fuelwood due to weak cross price elasticities while increased availability of lpg and potentially also increased awareness of indoor air pollution have greater prospect

informative advertising with differentiated products in this paper we study the role of promotional expenditures by sellers in a model of product differentiation advertising conveys full and accurate information about the characteristics of products heterogeneous consumers who have no source of information other than advertisements seek to purchase the products that best fit their needs despite the roles played by advertising in improving the matching of products and consumers and in increasing the elasticity of demand faced by each firm we find that the market determined levels of advertising are excessive given the extent of diversity in the market we derive a promotional equilibrium based on a specific information transmission technology paying explicit attention to the structure of consumer information and its impact on firms demand curves this allows us to study the effects of changes in the advertising technology including an increased ability to target messages to specific groups of consumers on the equilibrium in the product market we find that decreased advertising costs may reduce profits by increasing the severity of price competition

how will energy demand develop in the developing world most of the medium run growth in energy demand is forecast to come from the developing world which consumed more total units of energy than the developed world in 2007 we argue that the main driver of the growth is likely to be increased incomes among the poor and near poor we document that as households come out of poverty and join the middle class they acquire appliances such as refrigerators and vehicles for the first time these new goods require energy to use and energy to manufacture the current forecasts for energy demand in the developing world may be understated because they do not accurately capture the dramatic increase in demand associated with poverty reduction

from volatility to value analysing and managing financial and performance risk in energy savings projects abstract many energy related investments are made without a clear financial understanding of their values risks and volatilities in the face of this uncertainty the investor such as a building owner or an energy service company will often choose to implement only the most certain and thus limited energy efficiency measures conversely commodities traders and other sophisticated investors accustomed to evaluating investments on a value risk and volatility basis often overlook energy efficiency investments because risk and volatility information are not provided fortunately energy efficiency investments easily lend themselves to such analysis using tools similar to those applied to supply side risk management accurate and robust analysis demands a high level of understanding of the physical aspects of energy efficiency which enables the translation of physical performance data into the language of investment with a risk management analysis framework in place the two groups energy efficiency experts and investment decision makers can exchange the information they need to expand investment in demand side energy projects in this article we first present the case for financial risk analysis in energy efficiency in the buildings sector we then describe techniques and examples of how to identify quantify and manage risk finally we describe emerging market based opportunities in risk management for energy efficiency

promoting clean energy investment an empirical analysis of property assessed clean energy abstract from 2008 to 2010 a handful of property assessed clean energy pace programs offered property secured loans to homeowners for residential clean energy investments this analysis uses difference in differences models and synthetic counterfactual models to estimate the effect of three california pace programs on residential photovoltaic installations while pace programs do not offer superior terms to other solar financing options we find that pace financing increases solar installations by approximately 3 8 watts per owner occupied household per quarter a 108 increase over the mean watts per owner occupied household

a model of expertise we study a model in which perfectly informed experts offer advice to a decision maker whose actions affect the welfare of all experts are biased and thus may wish to pull the decision maker in different directions and to different degrees when the decision maker consults only a single expert the expert withholds substantial information from the decision maker we ask whether this situation is improved by having the decision maker sequentially consult two experts we first show that there is no perfect bayesian equilibrium in which full revelation occurs when both experts are biased in the same direction it is never beneficial to consult both in contrast when experts are biased in opposite directions it is always beneficial to consult both indeed in this case full revelation may be induced in an extended debate by introducing the possibility of rebuttal

persuasion by cheap talk we consider the credibility persuasiveness and informativ eness of multidimensional cheap talk by an expert to a decision maker we find that an expert with state independent preferences can always make credible comparative statements that trade off the expert s incentive to exaggerate on each dimension such communication benefits the expert cheap talk is persuasive if her preferences are quasiconvex communication benefits a decision maker by allowing for a more informed decision but strategic interactions between multiple decision makers can reverse this gain we apply these results to topics including product recommendations voting auction disclosure and advertising jel d44 d72 d82 d83 m37

cheap talk and bogus network externalities in the emerging technology market many emerging technologies exhibit path dependent demands driven by positive network feedback such network effects profoundly impact marketing strategists thinking in today s network economy however the significant network externalities expected by many people often fail to materialize in the emerging technology market we analyze this phenomenon in the context of a technology distribution channel by studying cheap talk strategies under information asymmetry we show that incentive compatible contracts are essential for achieving credible information transmission in our model the better informed technology vendor has an incentive to inflate the retailer s ex ante belief of network externalities when a wholesale price contract is adopted when properly termed revenue sharing contracts are implemented there are information efficient cheap talk equilibria where truthful information transmission is mutually beneficial when the vendor s information is imperfect even revenue sharing contracts cannot guarantee credible information transmission if there is significant prior belief disparity between the vendor and the retailer this study demonstrates how information inefficient equilibria e g information blockage arise because of the conflict of interest or the conflict of opinion among channel members it also explores the role of cheap talk in facilitating channel coordination

demand side management overcoming market barriers or obscuring real costs abstract this paper compares two approaches to estimating the net benefits of a demand side management program that subsidizes the purchase of efficient equipment the total resource cost trc test suggests net benefits of us 6 9 million estimates based on consumer s surplus yield an estimated net loss of us 6 3 million this gap is due to differences in estimates of participants net benefits market failures do not appear to be significant and thus cannot explain much of the gap the more plausible explanation is that the trc uses a lower discount rate than participants use for themselves and it omits some costs

electoral competition with informed and uninformed voters i present a model of electoral competition in which candidates raise campaign contributions by choosing policies that benefit interest groups and then expend those contributions to influence voters who are uninformed about the policies informed voters however vote based on those policies so candidates face a trade off between choosing a policy to generate funds to attract the uninformed vote and choosing a policy to attract the informed vote electoral equilibria are characterized for two categories of policies particularistic and collective in the case of particularistic policies the equilibrium policies of the candidates are separated if the proportion of uninformed voters is sufficiently high and the degree of separation is an increasing function of that proportion the model is extended to include the public financing of elections and incumbency advantages for the case of collective policies the candidates locate at the median of the ideal points of the informed voters and contributions are zero

balanced budget redistribution as the outcome of political competition this paper models balanced budget redistribution between socio economic groups as the outcome of electoral competition between two political parties equilibrium is unique in the present model and a sufficient condition for existence is given requiring that there be enough stochastic heterogeneity with respect to party preferences in the electorate the validity of hotelling s principle of minimum differentiation and of director s law are examined under alternative hypotheses concerning administrative costs of redistributions and voter s possibilities both of abstaining from voting and of becoming campaign activists for one of the parties the policy strategy of expected plurality maximization is contrasted with the strategy of maximizing the probability of gaining a plurality incomes are fixed and known so lump sum taxation is feasible however constraints on tax transfer differentiation between individuals are permitted in the analysis

household energy demand in kenya an application of the linear approximate almost ideal demand system la aids abstract this paper estimates price and fuel expenditure elasticities of demand by applying the linear approximate almost ideal demand system la aids to 3665 households sampled across kenya in 2009 the results indicate that motor spirit premium msp automotive gas oil ago and lubricants are price elastic while fuel wood kerosene charcoal liquefied petroleum gas lpg and electricity are price inelastic kerosene is income elastic while fuel wood charcoal lpg electricity msp and ago are income inelastic the results also reveal fuel stack behaviour that is multiple fuel use among the households main policy implications of the results include increasing the penetration of alternative fuels as well as provision of more fiscal incentives to increase usage of cleaner fuels this not withstanding however the household income should be increased beyond a certain point for the household to completely shift and use a new fuel

factors influencing willingness to pay for the energy star label abstract in the united states nearly 17 of greenhouse gas emissions come from residential energy use increases in energy efficiency for the residential sector can generate significant energy savings and emissions reductions consumer labels such as the us environmental protection agency s energy star promote conservation by providing consumers with information on energy usage for household appliances this study examines how the energy star label affects consumer preferences for refrigerators the results of an online survey of a national sample of adults suggest that consumers are on average willing to pay an extra 249 82 349 30 for a refrigerator that has been awarded the energy star label furthermore the results provide evidence that respondent willingness to pay was motivated by both private energy cost savings and public environmental benefits

news consumption and media bias bias in the market for news is well documented recent research in economics explains the phenomenon by assuming that consumers want to read watch news that is consistent with their tastes or prior beliefs rather than the truth the present paper builds on this idea but recognizes that i besides biased consumers there are also conscientious consumers whose sole interest is in discovering the truth and ii consistent with reality media bias is constrained by the truth these two factors were expected to limit media bias in a competitive setting our results reveal the opposite we find that media bias may increase when there are more conscientious consumers however this increased media bias does not necessarily hurt conscientious consumers who may be able to recover more information from multiple media outlets the more the outlets are biased we discuss the practical implications of these findings for media positioning media pricing media planning and the targeting of advertising

household fuel use in developing countries review of theory and evidence because of recent concerns about the negative externalities of traditional fuel use on the environment and health the issue of the household fuel transition in developing countries from dirty fuels towards clean fuels has received growing research attention this paper provides an up to date survey of the economic literature on household fuel use in these countries first we present the conceptual and theoretical frameworks then we discuss the empirical results that show how a wide range of factors drive the household fuel transition finally we suggest priorities for policy initiatives and highlight areas of future research

estimation of elasticities for domestic energy demand in mozambique abstract in mozambique households consume a mix of energy sources to satisfy their needs for lighting and cooking and for wealthier households other domestic necessities such as refrigeration the domestic energy mix depends on the prices of the sources and on the capability of the household to invest in the energy consuming appliances required to satisfy those needs based on data from a household survey carried out in mozambique during 2002 3 iaf this paper calculates the price and the income elasticities of demand for domestic energy using an econometric method developed by deaton the calculations are made for all households at the national level differentiating for urban and rural households and for the northern households of mozambique in the econometric formulation proxies for the ownership of energy appliances per household are used allowing a simple evaluation of the effects of asset ownership on the demand for energy own and cross price elasticities for five individual domestic sources are obtained low grade sources such as firewood and charcoal are less elastic elasticities of 0 41 and 0 28 respectively than candles kerosene and electricity respectively 0 88 0 79 and 0 60 income elasticities are respectively 0 45 0 32 0 93 0 84 and 0 69 placing firewood and charcoal as the less responsive to income variations and candles and kerosene as the most responsive we also comment on the factors influencing domestic energy transition

the persistence of subjective poverty in urban ethiopia using panel data spanning 15 years this paper investigates the persistence and correlates of subjective and consumption poverty in urban ethiopia despite the decline in consumption poverty in recent years which has been linked to rapid economic growth subjective poverty has remained largely unchanged dynamic probit regression results show that households with a history of past poverty continue to perceive themselves as poor even if their material consumption improves our results also suggest that the relative economic position of households is a strong determinant of subjective poverty and having at least some type of employment reduces the likelihood that households will perceive themselves as poor even if they remain in objective poverty receiving remittances from abroad on the other hand does not reduce perceived poverty even if it raises material consumption we argue that any analysis to measure the impact of growth on welfare should encompass subjective measures as well

an information rationale for the power of special interests political decisions are often biased in favor of special interests at the expense of the general public and they are frequently inefficient in the sense that the losses incurred by the majority exceed the gains enjoyed by the minority this article explains the bias in terms of information asymmetries and the free rider problem first incumbents increase their reelection prospects by biasing policy toward groups that are better able to monitor their activities second because smaller groups are better able to overcome the free rider problem of costly monitoring policy will be biased in their favor third the effect of asymmetric monitoring on voter welfare is ambiguous the inefficiencies created by the policy bias are offset by a positively valued selection bias incumbents of above average quality are more likely to survive voter scrutiny than are low quality types

actuarial pricing of energy efficiency projects lessons foul and fair recent market convulsions in the energy industry have generated a plethora of post mortem analyses on a wide range of issues including accounting rules corporate governance commodity markets and energy policy while most of these analyses have focused on business practices related to wholesale energy trading there has been limited analysis of retail energy services particularly energy efficiency projects we suggest that there were several business concepts and strategies in the energy efficiency arena whose inherent value may have been masked by the larger failure of companies such as enron in this paper we describe one such concept namely actuarial pricing of energy efficiency projects which leverages a portfolio based approach to risk management first we discuss the business drivers contrasting this approach with conventional industry practice we then describe the implementation of this approach including an actuarial database pricing curves and a pricing process compatible with commodity pricing we conclude with a discussion of the prospects and barriers for the further development of transparent and quantifiable risk management products for energy efficiency a prerequisite for developing energy efficiency as a tradeable commodity we address these issues from an experiential standpoint drawing mostly on our experience in developing and implementing such strategies at enron

cheap talk advertising and misrepresentation in vertically differentiated markets i consider a cheap talk model in which a firm has a chance to communicate its product quality to consumers the model describes how advertising can be both informative to consumers and profitable for the firm through its content in a vertically differentiated market i find that advertising content may be effective in inducing search even if incentives for misrepresentation exist in particular a firm with an undesirable low quality product is able to attract consumers who would have not incurred a search cost had they known its true quality in this case a semiseparating equilibrium occurs where the lowest firm types pool upward in order to increase the expected product quality while simultaneously signaling that the product is affordable although consumers always benefit from truth in advertising total welfare may decrease if an undesirable firm is required to reveal its type finally i show that the extent to which misrepresentation can take place increases with the cost of advertising coverage

prices as signals of product quality this paper is concerned with the provision of quality in markets in which consumers have only imperfect information the analysis focuses on a market for a product that can be produced at different quality levels all consumers prefer higher to lower quality but they may differ in their willingness to pay for quality producers can produce any quality they like but higher qualities are more costly to produce the information in this market is imperfect in the sense that the exact quality chosen by a firm is known only to the firm itself some information about the quality of a firm s product will however reach its potential customers even if they do not make any special effort to acquire it within the framework suggested here two conclusions are drawn first prices may serve as signals which exactly differentiate the available quality levels that is there exists a fulfilledexpectations equilibrium at which each price signals a unique quality level second the pricesignals are not arbitrary each price signal exceeds the marginal cost of producing the quality it signals such a mark up depends on the nature of the product specific information received by consumers the poorer the information the higher the mark up

cold houses in warm climates and vice versa a paradox of rational heating houses in cold climates are kept warmer in winter than those in warm climates des pite the greater cost of heating in colder climates it is shown that this is not only consistent with but also implied by rationality the contrary intuition is based on a confusion between average and ma rginal cost the same analysis implies that it is rational to keep th e thermostat setting constant throughout the heating season rather th an changing it with changes in external temperature copyright 1987 by university of chicago press

government control of the media abstract we present a formal model of government control of the media to illuminate variation in media freedom across countries and over time media bias is greater and state ownership of the media more likely when the government has a particular interest in mobilizing citizens to take actions that further some political objective but are not necessarily in citizens individual best interest however the distinction between state and private media is smaller large advertising markets reduce media bias in both state and private media but increase the incentive for the government to nationalize private media media bias in state and private media markets diverge as governments become more democratic whereas media bias in democracies and autocracies converge as positive externalities from mobilization increase

when does coordination require centralization this paper compares centralized and decentralized coordination when manag ers are privately informed and communicate strategically we consider a multi divisional organization in which decisions must be adapted to local conditions but also coordinated with each other information about local conditions is dispersed and held by self interested division managers who communicate via cheap talk the only available formal mechanism is the allocation of decision rights we show that a higher need for coordination improves horizontal com

determinants of household energy consumption in india improving access to affordable modern energy is critical to improving living standards in the developing world rural households in india in particular are almost entirely reliant on traditional biomass for their basic cooking energy needs this has adverse effects on their health and productivity and also causes environmental degradation this study presents a new generic modelling approach with a focus on cooking fuel choices and explores response strategies for energy poverty eradication in india the modelling approach analyzes the determinants of fuel consumption choices for heterogeneous household groups incorporating the effect of income distributions and traditionally more intangible factors such as preferences and private discount rates the methodology is used to develop alternate future scenarios that explore how different policy mechanisms such as fuel subsidies and micro financing can enhance the diffusion of modern more efficient energy sources in india

price effects of energy efficient technologies a study of residential demand for heating and cooling energy efficient appliances reduce the marginal price of the services they deliver this article shows empirically that such price reductions result in energy savings that are smaller than those engineering techniques generally project using econometric techniques with data from a unique utility experiment and a detailed engineering thermal load model we find that actual conservation is as much as 13 below engineering estimates for cooling and 8 12 below for heating customers who conserve electricity are also persistent their houses are comparatively warmer in summer and cooler in winter

the market for news we investigate the market for news under two assumptions that readers hold beliefs which they like to see confirmed and that newspapers can slant stories toward these beliefs we show that on the topics where readers share common beliefs one should not expect accuracy even from competitive media competition results in lower prices but common slanting toward reader biases on topics where reader beliefs diverge such as politically divisive issues however newspapers segment the market and slant toward extreme positions yet in the aggregate a reader with access to all news sources could get an unbiased perspective generally speaking reader heterogeneity is more important for accuracy in media than competition per se

household energy preferences for cooking in urban ouagadougou burkina faso abstract an extensive survey on household expenditures in ouagadougou the capital of burkina faso was used to analyze the factors determining urban household energy choices using a multinomial logit model wood energy remains the preferred fuel of most urban households in the country though rational the choice is not sustainable as it portends a threat to the savanna woodlands and the economy many important policies have been adopted by public authorities to minimize household wood energy consumption and to substitute it by alternative fuel despite the magnitude of all these policies the depletion rate of the forest resource is increasing a kind of inertia is thus observed for household preferences for cooking fuel this model analyzes the sociological and economic variables of household energy preferences for cooking in ouagadougou the analyses show that the inertia of household cooking energy preferences are due to poverty factors such as low income poor household access to electricity for primary and secondary energy low house standard household size high frequency of cooking certain meals using woodfuel as cooking energy the descriptive analyses show that the domestic demand for wood energy is strongly related to household income the firewood utilization rate decreases with increasing household income in other words this fuel appears as a transition good for these households which aim for other sources of energy for cooking that are more adapted for urban consumption this implies that a price subsidy policy for liquid petroleum gas lpg and its cook stoves could significantly decrease the utilization rate of wood energy

quantifying the impact of r d on pv project financing costs abstract energy technology research and development r d typically focuses on advancing the performance and reducing equipment and installation costs however such r d can also have significant indirect impacts on other factors incorporating the impact that r d activities have on financing costs can provide a more complete picture of the consequences of these decisions and may allow policymakers to make better decisions in this paper we discuss some historical examples of r d impacting financing costs in the solar energy sector summarize the areas of r d that can impact financing and describe methodological approaches that can be used to quantify the impact of r d on financing costs and as a result the levelized cost of energy lcoe we estimate that r d driven reductions in financing costs in the solar sector from current levels to low risk levels could reduce lcoe approximately 25 alternatively without the r d advances needed to prevent future risks and complications financing costs in the solar sector could increase by as much as 115

the panel study of income dynamics after fourteen years an evaluation this article considers the representativeness of the panel study of income dynamics psid over its 14 year history from 1968 to 1981 given the dynamics of entry and exit from the panel by 1981 40 of the original members had left the sample and were replaced by new entrants who joined either existing households or new households being formed by members of the original sample we consider the distribution of demographic characteristics and earnings equations over time and we compare the psid with the current population survey cps by either approach we find little evidence that the psid has become unrepresentative

selective reporting of factual content by commercial media the authors study the market for factual content and examine whether competition increases or decreases its provision factual content is supplied by commercial media firms which observe a set of facts depicting the state of the world and selectively decide how to report them consumers value content that matches their opinion which incentivizes media firms to slant their reports by omitting certain facts novel features in the authors model include consumers ability to anticipate the media s incentives for slant and the requirement that all media stances must be supported by facts furthermore consumers find reports with more facts to be more convincing despite consumers ability to detect slant and their demand for factual support the research shows that competition results in consumers reading fewer facts and being unable to update their prior beliefs about the state of the world the authors also find that a monopoly medium may be more polarizing than competitive media and that polarized report

oil and energy price volatility it is commonly believed that since the 1973 oil crisis oil and energy prices have been more volatile than other commodity prices this study examines monthly producer prices for thousands of products over the period january 1945 through august 2005 the results show that crude oil refined petroleum and natural gas prices are more volatile than prices for about 95 of products sold by domestic producers relative to crude commodities however crude oil prices are currently more volatile than about 65 of other products and oil price volatility first exceeded the median for crude commodities following the 1986 drop in oil prices

electoral competition and special interest politics have fixed positions on some issues but vary their positions on others in order to attract votes and campaign contributions in this context we examine whether special interest groups are governed by an electoral motive or an influence in their campaign giving and how their contributions affect the equilibrium platforms we show that each party is induced to behave as if it were maximizing a weighted sum of the aggregate welfares of informed voters and members of special interest groups the party that is expected to win a majority of seats caters more to the special interests

a signal jamming theory of predation we propose a new theory ofpredation based on signal jamming in our model the predator s characteristics are common knowledge while the entrant is uncertain of his own future profitability the entrant uses his current profit to decide whether to remain in the market and the predator preys to jam or interfere with this inference problem thus our model differs from those based on reputation effects in which the predator preys to signal information about himself

clean fuel saving technology adoption in urban ethiopia abstract the heavy dependence and inefficient utilization of biomass resources have contributed to the depletion of forest resources in ethiopia while the use of traditional cooking technology has also been linked to indoor air pollution and poor health in response the government and other institutions have pushed for the adoption of new cooking technologies with limited success this research examines the reasons underpinning the lack of widespread adoption via duration analysis correlating the speed of adoption of mirte and lakech cook stoves two examples of new cooking technologies in urban ethiopia to socioeconomic factors according to the duration analysis adoption rates have steadily increased over time while economic factors such as product price household income and household wealth are for the most part important determinants of adoption behavior there is also evidence that the availability of substitute technologies tends to hinder adoption and that there are large regional differences in adoption rates suggesting the need for a more detailed regional analysis of adoption decisions

modeling the choice to switch from fuelwood to electricity implications for giant panda habitat conservation despite its status as a nature reserve wolong nature reserve china has experienced continued loss of giant panda habitat due to human activities such as fuelwood collection electricity though available throughout wolong has not replaced fuelwood as an energy source we used stated preference data obtained from in person interviews to estimate a random utility model of the choice of adopting electricity for cooking and heating willingness to switch to electricity was explained by demographic and electricity factors price voltage and outage frequency in addition to price nonprice factors such as voltage and outage frequency significantly affect the demand thus lowering electricity prices and increasing electricity quality would encourage local residents to switch from fuelwood to electricity and should be considered in the mix of policies to promote conservation of panda habitat 2002 elsevier science b v all rights reserved

ahp based risk analysis of energy performance contracting projects in russia abstract understanding and properly managing risks that could potentially affect the target and performance based profits of energy performance contracting epc projects are essential it is particularly important for the establishment and success of energy service companies escos acting in the vulnerable environment of the vast but highly energy inefficient russian market this study systematically explores common risk factors and causes of risk associated with epc projects executed in three russian sectors 1 industrial 2 housing and communal services and 3 public several interviews with the russian epc experts were accomplished and a qualitative risk assessment by using an analytic hierarchy process ahp approach the data were obtained from a web based questionnaire survey conducted among russian epc project executors for each focus sector a specific preference based ranking of the identified risk factors and causes of risk was derived the ahp results show that causes of risk related to the financial and regulatory aspects contribute most to the riskiness of epc projects performed in all three focus sectors in russia calling for the special attention of epc policy and business makers due to sectorial particularities and different actors involved we conclude that there is a need for elaboration of sector specific contractual schemes for epc projects

evaluating energy efficiency investments accounting for risk in the discounting process a prominent feature of the literature regarding the economics of energy conservation is the debate over the existence and nature of the so called efficiency gap a frequent subject of debate is whether consumers apply a reasonable discount rate when evaluating the future benefits of energy efficiency measures a key aspect of the discounting debate is the manner in which consumer attitudes toward risk are accounted for when discounting this paper suggests that an appropriate approach to incorporating risk into the evaluation of energy efficiency projects would yield higher net benefits to such projects than standard evaluation techniques we argue that analysing the purchase of fuel saving capital as though it were a standard investment in a physical asset obscures an important feature of the decision rather than deciding whether or not to invest in an asset with an uncertain future benefit stream the consumer is actually choosing between two future cost streams each of which is uncertain this seemingly minor change in perspective has important implications for how the risk associated with fuel saving capital should be brought into the discounting process an example based on lighting technologies is used to illustrate the principles discussed

household level consumption in urban ethiopia the effects of a large food price shock summary we use survey data to investigate how urban households in ethiopia coped with the food price shock in 2008 qualitative data indicate that the high food price inflation was by far the most adverse economic shock between 2004 and 2008 and that a significant proportion of households had to adjust food consumption in response regression results indicate that households with low asset levels and casual workers were particularly adversely affected by high food prices we interpret the results as pointing to the importance of growth in the formal sector so as to generate more well paid and stable jobs

the choice of energy saving modes for an energy intensive manufacturer considering non energy benefits in practice energy intensive manufacturers have two main options when improving their energy efficiency design and implement energy efficiency projects on their own we call this self saving or enter into an energy performance contracting epc which mainly includes shared savings and guaranteed savings in this paper we will discuss an energy intensive manufacturer facing self saving and shared savings options and how this manufacturer chooses the optimal energy saving mode when non energy benefits are considered we only consider costs and profit as non energy benefits and formulate an optimization model of self saving and a stackelberg game model of shared savings from our model analysis when considering only energy savings we find that the optimal unit savings has a monotonic impact on the optimal profit of the manufacturer our results indicate that the manufacturer will prefer the second option to the first when the investment cost factor ratio of the energy service company esco to the manufacturer is small otherwise the manufacturer will prefer the first to the second furthermore when considering non energy benefits we find that the results change in some cases

mass media competition political competition and public policy if better informed voters receive favourable policies then mass media will affect policy because mass media provide most of the information people use in voting this paper models the incentives of the media to deliver news to different groups the increasing returns to scale technology and advertising financing of media firms induce them to provide more news to large groups such as taxpayers and dispersed consumer interests and groups that are valuable to advertisers this news bias alters the tradeoff in political competition and therefore introduces a bias in public policy the paper also discusses the effects of broadcast media replacing newspapers as the main information source about politics the model predicts that this change should raise spending on government programmes used by poor and rural voters

the emergence of trading and risk management in liberalized electricity markets abstract trading and risk management services are essential components of liberalized electricity markets they thrive in markets where prices are volatile and customers need protection from unwanted and poorly understood risks this viewpoint describes the fundamentals and explains what has been driving their phenomenal growth in the recent past in the usa

prospect theory and energy efficiency abstract investments in energy efficiency entail uncertainty and when faced with uncertainty consumers have been shown to behave according to prospect theory preferences are reference dependent and exhibit loss aversion and probabilities are subjectively weighted using data from a choice experiment eliciting prospect theory parameters i provide evidence that loss averse people are less likely to invest in energy efficiency then i consider policy design under prospect theory when there are also externalities from energy use a higher degree of loss aversion implies a higher subsidy to energy efficiency numerical simulations suggest that the impact of prospect theory on policy may be substantial

evolution of the u s energy service company industry market size and project performance from 1990 2008 lbnl xxxx e rnest o rlando l awrence b erkeley n ational l aboratory evolution of the u s energy service company industry market size and project performance from 1990 2008 peter h larsen charles a goldman and andrew satchwell environmental energy technologies division may 2012 pre print of article submitted for publication to energy policy the work described in this report was funded by the u s department of energy s office of energy efficiency and renewable energy weatherization and intergovernmental program and the permitting siting and analysis division of the office of electricity delivery and energy reliability under contract no de ac02 05ch11231

persuasive puffery sellers often make claims about product strengths without providing evidence even though such claims are mere puffery we show that they can be credible because talking up any one strength comes at the implicit trade off of not talking up another potential strength puffery pulls in some buyers who value product attributes that are talked up or emphasized while pushing away other buyers who infer that the attributes they value are relative weaknesses when the initial probability of making a sale is low there are more potential buyers to pull in than to push away so puffery is persuasive overall this persuasiveness requires that buyers have some privacy about their preferences so that the seller does not completely pander to them more generally the results show how comparative cheap talk by an expert to a decision maker can be credible and persuasive in standard discrete choice models used throughout marketing economics and other disciplines

can the urban poor afford modern energy the case of ethiopia abstract comparing rough measures of costs of using modern fuels and purchasing power of the urban poor in ethiopia this article finds that while kerosene is relatively cheap even for the very poor electricity is extremely expensive even for the relatively well to do the upper stratum of the poor may have the purchasing power to access butane gas in addition the article examines the relevance of the energy ladder hypothesis generally both at the aggregate level and for individual urban areas the prediction from the hypothesis holds but our results indicate that the relevance of the hypothesis weakens on lower levels of aggregation implying significant inter city variations finally demand equations for each fuel are econometrically estimated and the elasticities are used to examine price and income effects the budget elasticities indicate that with economic growth the demand for traditional fuels will increase in addition the cross price elasticities show that increase in the price of a traditional fuel mainly shifts demand towards other traditional fuels rather than towards modern fuels this slows down the transition towards modern fuels the article concludes by presenting policy recommendations arising from the analysis

market influence on the low carbon energy refurbishment of existing multi residential buildings abstract this paper explores the relationship between the energy market the political and regulatory context and energy design decisions for existing multi residential buildings to determine what form the energy market landscape would take if tailored to encourage low carbon solutions the links between market dynamics government strategies and building designs are mapped to understand the steps that achieve carbon reduction from building operation this is achieved using a model that takes financial and energy components with market and design variables to provide net present cost and annual carbon outputs the financial component applies discounted cash flow analysis over the building lifespan with discount rates reflecting contractual characteristics the carbon component uses standard assessment procedure sap 2005 a scenario approach is adopted to test alternative strategies selected to encourage low carbon solutions in two residential and two office designs the results show that the forward assumption of energy price escalation is the most influential factor on energy investment together with the expected differentiation between the escalation of gas and electricity prices using this and other influencing factors the research reveals trends and strategies that will achieve mainstream application of energy efficiency and microgeneration technologies and reduce carbon emissions in the existing multi residential sector

explaining the energy efficiency gap expected utility theory versus cumulative prospect theory abstract energy efficiency is one of the key factors in mitigating the impact of climate change and preserving non renewable resources although environmental and economic justifications for energy efficiency investments are compelling there is a gap between the observable and some notion of optimized energy consumption the so called energy efficiency gap behavioral biases in individual decision making have been resonated by environmental research to explain this gap to analyze the influence of behavioral biases on decisions upon energy efficiency investments quantitatively we compare expected utility theory with cumulative prospect theory on basis of a real world example we illustrate how the extent of the gap is influenced by behavioral biases such as loss aversion probability weighting and framing our findings indicate that cumulative prospect theory offers possible explanations for many barriers discussed in literature for example the size of the gap rises with increased risk and investment costs because behavioral biases are systematic and pervasive our insights constitute a valuable quantitative basis for environmental policy measures such as customer focused and quantitatively backed public awareness campaigns financial incentives or energy savings insurances in this vein this paper may contribute to an accelerated adaption of energy efficiency measures by the broader public