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The Effect of Information Provision on Stated and Revealed Preferences: A Field Experiment on the Choice of Power Tariffs Before and After Japanese Retail Electricity Liberalization

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  • Takunori Ishihara

    (Kyoto University of Advanced Science)

  • Takanori Ida

    (Kyoto University)

Abstract

This paper examines differences in attitudes towards electricity fee plans when information is provided on electricity bills based on past electricity consumption. We conducted randomized controlled trial stated preference (SP) and revealed preference (RP) experiments on the choice of electricity rates before and after liberalization. In the SP experiment, we measured participants' valuations of their electricity pricing plans. We found that providing information about the participants' benefit from switching diminished the tendency towards overconfidence. The valuation decreases substantially when information shows that a loss will be incurred from switching. The results of the RP and SP experiments differ. We found that the selection was not changed in the RP experiment even when providing information that a loss would be incurred.

Suggested Citation

  • Takunori Ishihara & Takanori Ida, 2022. "The Effect of Information Provision on Stated and Revealed Preferences: A Field Experiment on the Choice of Power Tariffs Before and After Japanese Retail Electricity Liberalization," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 82(3), pages 573-599, July.
    • Handle: RePEc:kap:enreec:v:82:y:2022:i:3:d:10.1007_s10640-022-00667-0
    DOI: 10.1007/s10640-022-00667-0
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    More about this item

    Keywords

    Randomized controlled trial (RCT); Stated preference; Revealed preference; Information provision; Power tariff; Overconfidence;
    All these keywords.

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • Q49 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Other

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