Environmental externalities and free-riding in the household

IF 5.1 1区 经济学 Q1 ECONOMICS
B. Kelsey Jack , Seema Jayachandran , Flavio Malagutti , Sarojini Rao
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引用次数: 0

Abstract

In addition to generating a negative environmental externality, a household’s water consumption entails another “market failure”: household members free-ride off each other and overconsume. The problem stems from consumption being billed at the household level and the difficulty of monitoring one another’s consumption. We document the importance of this phenomenon in urban Zambia by combining utility billing records and randomized person-specific price variation. We derive and empirically confirm the following prediction: Individuals with weaker incentives to conserve under the household’s financial arrangements reduce water use more when their person-specific price increases. Another prediction is that this overconsumption problem is more acute when the financial benefit of a lower utility bill is shared unevenly among household members. We show that households indeed seem more responsive to a change in the household-level price of water when their financial arrangements are more equal. Our results offer a novel explanation for the low price sensitivity of residential water (and electricity) consumption.

家庭中的环境外部效应和搭便车现象
除了产生负面的环境外部性之外,家庭用水还会导致另一种 "市场失灵":家庭成员之间相互搭便车,过度消费。这一问题源于家庭层面的消费计费以及难以监控彼此的消费情况。我们结合公用事业账单记录和随机的个人价格变化,记录了这一现象在赞比亚城市的重要性。我们得出了以下预测,并通过经验证实了这一预测:在家庭财务安排下,节水动机较弱的个人在其个人价格上涨时会减少更多的用水量。另一个预测是,当较低水电费带来的经济利益在家庭成员之间分配不均时,这种过度消费问题会更加严重。我们的研究结果表明,当家庭的财务安排更加平等时,家庭对家庭水价变化的反应确实更灵敏。我们的研究结果为居民水(和电)消费的低价格敏感性提供了一种新的解释。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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来源期刊
CiteScore
8.30
自引率
4.00%
发文量
126
审稿时长
72 days
期刊介绍: The Journal of Development Economics publishes papers relating to all aspects of economic development - from immediate policy concerns to structural problems of underdevelopment. The emphasis is on quantitative or analytical work, which is relevant as well as intellectually stimulating.
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