Chandra Kiran B Krishnamurthy
() and Bengt Kriström
Chandra Kiran B Krishnamurthy: Centre for Environmental and Resource Economics, Postal: Umeå University, 901 87 Umea, Sweden
Bengt Kriström: Centre for Environmental and Resource Economics, Postal: Umeå University, 901 87 Umea, Sweden
Abstract: We provide consistent, cross-country estimates of price and income elasticity for the residential sector of 11 OECD countries. Using survey data from 2011 on annual consumption of electricity and sample-derived average electricity price, we provide country-specific price elasticity estimates and average income elasticity estimates. For most countries in our sample, we find strong price responsiveness, with elasticities varying between -0:27 for South Korea and -1:4 for Australia, with most countries elasticity being above (in absolute value) -0:5. Exploiting the presence of many attitudinal indicators, we find evidence for non-price related factors, in particular households’self-reported energy saving behavior, to reduce energy demand between 2 and 4%. In contrast, we find very weak income response, with income elasticities varying from 0:07 to 0:14 and no evidence for heterogeneity across the countries in our sample. Our results regarding price elasticity are in contrast with many existing studies which find low-to-moderate price responsiveness, and adds to a few recent studies indicating more policy space for demand reduction than previously thought.
30 pages, First version: August 14, 2013. Revised: June 30, 2014.
Full text files
Questions (including download problems) about the papers in this series should be directed to Mona Bonta Bergman ()
Report other problems with accessing this service to Sune Karlsson ().
This page generated on 2018-01-23 23:37:54.