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Testing the effect of defaults on the thermostat settings of OECD employees

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  • Brown, Zachary
  • Johnstone, Nick
  • Haščič, Ivan
  • Vong, Laura
  • Barascud, Francis

Abstract

We describe a randomized controlled experiment in which the default settings on office thermostats in an OECD office building were manipulated during the winter heating season, and employees' chosen thermostat setting observed over a 6-week period. Using difference-in-differences, panel, and censored regression models (to control for maximum allowable thermostat settings), we find that a 1°C decrease in the default caused a reduction in the chosen setting by 0.38°C, on average. Sixty-five percent of this effect could be attributed to office occupant behavior (p-value=0.044). The difference-in-differences models show that small decreases in the default (1°) led to a greater reduction in chosen settings than large decreases (2°). We also find that office occupants who were more apt to adjust their thermostats prior to the intervention were less susceptible to the default. We conclude that this kind of intervention can increase building-level energy efficiency, and discuss potential explanations and broader policy implications of our findings.

Suggested Citation

  • Brown, Zachary & Johnstone, Nick & Haščič, Ivan & Vong, Laura & Barascud, Francis, 2013. "Testing the effect of defaults on the thermostat settings of OECD employees," Energy Economics, Elsevier, vol. 39(C), pages 128-134.
  • Handle: RePEc:eee:eneeco:v:39:y:2013:i:c:p:128-134
    DOI: 10.1016/j.eneco.2013.04.011
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    2. Schubert, Christian, 2017. "Green nudges: Do they work? Are they ethical?," Ecological Economics, Elsevier, vol. 132(C), pages 329-342.
    3. Nicole D. Sintov & P. Wesley Schultz, 2017. "Adjustable Green Defaults Can Help Make Smart Homes More Sustainable," Sustainability, MDPI, Open Access Journal, vol. 9(4), pages 1-12, April.
    4. Datta,Saugato & Miranda Montero,Juan Jose & Zoratto,Laura De Castro & Calvo-Gonzalez,Oscar & Darlingm,Matthew & Lorenzana,Karina Josephine Orduna, 2015. "A behavioral approach to water conservation: evidence from Costa Rica," Policy Research Working Paper Series 7283, The World Bank.
    5. Schleich, Joachim & Gassmann, Xavier & Faure, Corinne & Meissner, Thomas, 2016. "Making the implicit explicit: A look inside the implicit discount rate," Energy Policy, Elsevier, vol. 97(C), pages 321-331.
    6. Rachel Croson & Nicolas Treich, 2014. "Behavioral Environmental Economics: Promises and Challenges," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 58(3), pages 335-351, July.
    7. Kaiser, Micha & Bernauer, Manuela & Sunstein, Cass R. & Reisch, Lucia A., 2020. "The power of green defaults: the impact of regional variation of opt-out tariffs on green energy demand in Germany," Ecological Economics, Elsevier, vol. 174(C).
    8. Ida, Takanori & Motegi, Naoya & Ushifusa, Yoshiaki, 2019. "Behavioral study of personalized automated demand response in the workplace," Energy Policy, Elsevier, vol. 132(C), pages 1009-1016.
    9. Takanori Ida & Naoya Motegi & Yoshiaki Ushifusa, 2016. "Behavioral Study of Personalized Automated Demand Response in Workplaces," Discussion papers e-16-010, Graduate School of Economics , Kyoto University.
    10. Cattaneo, Cristina, 2018. "Internal and External Barriers to Energy Efficiency: Made-to-Measure Policy Interventions," CSI: Climate and Sustainable Innovation 269536, Fondazione Eni Enrico Mattei (FEEM).
    11. Gabriela Michalek & Georg Meran & Reimund Schwarze & Özgür Yildiz, 2015. "Nudging as a new 'soft' tool in environmental policy. An analysis based on insights from cognitive and social psychology," Discussion Paper Series RECAP15 21, RECAP15, European University Viadrina, Frankfurt (Oder).
    12. Ramos, A. & Gago, A. & Labandeira, X. & Linares, P., 2015. "The role of information for energy efficiency in the residential sector," Energy Economics, Elsevier, vol. 52(S1), pages 17-29.
    13. Loureiro, Maria & Labandeira, Xavier, 2019. "Exploring Energy Use in Retail Stores: A Field Experiment," Energy Economics, Elsevier, vol. 84(S1).
    14. Beshears, John & Kosowsky, Harry, 2020. "Nudging: Progress to date and future directions," Organizational Behavior and Human Decision Processes, Elsevier, vol. 161(S), pages 3-19.
    15. Ornaghi, Carmine & Costanza, Enrico & Kittley-Davies, Jacob & Bourikas, Leonidas & Aragon, Victoria & James, Patrick A.B., 2018. "The effect of behavioural interventions on energy conservation in naturally ventilated offices," Energy Economics, Elsevier, vol. 74(C), pages 582-591.
    16. Lara Anne Hale, 2018. "At Home with Sustainability: From Green Default Rules to Sustainable Consumption," Sustainability, MDPI, Open Access Journal, vol. 10(1), pages 1-18, January.
    17. Raisa Sherif, 2021. "Are pro-environment behaviours substitutes or complements? Evidence from the field," Working Papers tax-mpg-rps-2021-03, Max Planck Institute for Tax Law and Public Finance.
    18. Llerena, D. & Roussillon, B. & Teyssier, S. & Buckley, P. & Delinchant, B. & Ferrari, J. & Laranjeira, T. & Wurtz, F., 2021. "Demand response in the workplace: A field experiment," Working Papers 2021-01, Grenoble Applied Economics Laboratory (GAEL).
    19. Mariola E. Zalewska, 2021. "The Impact of Incentives on Employees to Change Thermostat Settings—A Field Study," Energies, MDPI, Open Access Journal, vol. 14(17), pages 1-14, August.
    20. Cattaneo, Cristina, 2018. "Internal and External Barriers to Energy Efficiency: Made-to-Measure Policy Interventions," CSI: Climate and Sustainable Innovation 269536, Fondazione Eni Enrico Mattei (FEEM).

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    More about this item

    Keywords

    Behavioral economics; Energy efficiency; Field experiments;
    All these keywords.

    JEL classification:

    • B5 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches
    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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