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Sample size: 2440
Field period: 10/22/2013-08/19/2014
The objective of our project is to evaluate the welfare costs of this inaccurate information. We propose an online experiment to measure how consumer decisions would change with better (i.e. more accurate) labels. Our hypothesis is that better labels will lead to better choices. More precisely, we hypothesize that total lifetime cost (purchase price plus expected present discounted energy costs) will fall as participants choose units that better match their local electricity prices and demand for usage.
Appliance choice and resultant lifetime cost of appliance
Davis, Lucas W. and Gilbert E. Metcalf. "Does Better Information Lead to Better Choices? Evidence from Energy-Efficiency Labels." Working Paper, March 2015.