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Energy Use And Temperature Habituation: Evidence From High Frequency Thermostat Usage Data

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  • Qi Ge
  • Benjamin Ho

Abstract

Using micro‐level thermostat data from 27,000 U.S. households, we analyze how home heating/cooling decisions respond to weather. Responses are greater for extreme heat than for extreme cold and persist for at least 30 days after exposure, due in part to transaction costs but also to changes in intrinsic preferences. Failure to understand habit can lead us to overestimate the impact of short‐term policy nudges but underestimate the long‐run impact of small changes. Higher frequency estimates of how behavior responds to weather improve our understanding of climate adaptation as climate change affects not only mean temperatures but also variances. (JEL C55, D03, Q4)

Suggested Citation

  • Qi Ge & Benjamin Ho, 2019. "Energy Use And Temperature Habituation: Evidence From High Frequency Thermostat Usage Data," Economic Inquiry, Western Economic Association International, vol. 57(2), pages 1196-1214, April.
    • Handle: RePEc:bla:ecinqu:v:57:y:2019:i:2:p:1196-1214
    DOI: 10.1111/ecin.12744
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • C55 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Large Data Sets: Modeling and Analysis
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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