Price Premium for High-Efficiency Refrigerators and Calculation of Price-Elasticities for Close-Substitutes: Combining Hedonic Pricing and Demand Systems
This article uses the hedonic pricing method to estimate the price premium paid for the highest energy-efficiency label (A+) in the refrigerators market of the Basque Autonomous Community (Spain). The estimated figure is 8.9% of the final price or about 60 euro, which represents one third of the energy savings that a consumer gets during the lifetime of a refrigerator with the highest energy-efficiency label. This figure is then combined with the linear version of the Almost Ideal Demand System (LA/AIDS) to obtain own and cross-price elasticities of demand. The information presented here is useful for policy design and analysis. The results indicate that the demand for refrigerators with the highest energy-efficiency label is highly sensitive to price variations.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Nerlove, Marc, 1995. "Hedonic price functions and the measurement of preferences: The case of Swedish wine consumers," European Economic Review, Elsevier, vol. 39(9), pages 1697-1716, December.
- Stavins, Joanna, 1997.
"Estimating demand elasticities in a differentiated product industry: The personal computer market,"
Journal of Economics and Business,
Elsevier, vol. 49(4), pages 347-367.
- Joanna Stavins, 1995. "Estimating demand elasticities in a differentiated product industry: the personal computer market," Working Papers 95-9, Federal Reserve Bank of Boston.
- Oczkowski, Edward, 2001. "Hedonic Wine Price Functions and Measurement Error," The Economic Record, The Economic Society of Australia, vol. 77(239), pages 374-382, December.
- Xavier Labandeira & Pedro Linares, 2010.
"Energy efficiency: Economics and Policy,"
05-2010, Economics for Energy.
- Ivanova Nadezhda, 2005. "Estimation of own- and cross-price elasticities of disaggregated imported and domestic goods in Russia," EERC Working Paper Series 05-13e, EERC Research Network, Russia and CIS.
- C. Couton & F. Gardes & Y. Thepaut, 1996. "Hedonic prices for environmental and safety characteristics and the Akerlof effect in the French car market," Applied Economics Letters, Taylor & Francis Journals, vol. 3(7), pages 435-440.
- Edward Oczkowski, 1994.
"A Hedonic Price Function For Australian Premium Table Wine,"
Australian Journal of Agricultural and Resource Economics,
Australian Agricultural and Resource Economics Society, vol. 38(1), pages 93-110, 04.
- Oczkowski, Edward A., 1994. "A Hedonic Price Function For Australian Premium Table Wine," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 38(01), April.
- Oczkowski, Edward A., 1993. "A Hedonic Price Function for Australian Premium Table Wine," 1993 Conference (37th), February 9-11, 1993, Sydney, Australia 147769, Australian Agricultural and Resource Economics Society.
- Bordley, Robert F, 1993. "Estimating Automotive Elasticities from Segment Elasticities and First Choice/Second Choice Data," The Review of Economics and Statistics, MIT Press, vol. 75(3), pages 455-462, August.
- Markandya, Anil & Ortiz, Ramon Arigoni & Mudgal, Shailendra & Tinetti, Benoit, 2009. "Analysis of tax incentives for energy-efficient durables in the EU," Energy Policy, Elsevier, vol. 37(12), pages 5662-5674, December.
- J. A. Molina, 1994. "Food Demand In Spain: An Application Of The Almost Ideal System," Journal of Agricultural Economics, Wiley Blackwell, vol. 45(2), pages 252-258.
- Ibon Galarraga & Anil Markandya, 2003. "The analysis of welfare effects of an environmental product tax: an application to the taxation of car tyres in Hungary," Fiscal Studies, Institute for Fiscal Studies, vol. 24(1), pages 97-114, March.
- Galarraga, Ibon & Markandya, Anil, 2004. "Economic techniques to estimate the demand for sustainable products: a case study for fair trade and organic coffee in the United Kingdom," Economia Agraria y Recursos Naturales, Spanish Association of Agricultural Economists, vol. 4(07).
- Gordon Anderson & Richard Blundell, 1983. "Testing Restrictions in a Flexible Dynamic Demand System: An Application to Consumers' Expenditure in Canada," Review of Economic Studies, Oxford University Press, vol. 50(3), pages 397-410.
- Moschini, GianCarlo, 1995.
"Units of Measurement and the 'Stone Index' In Demand System Estimation,"
Staff General Research Papers Archive
5058, Iowa State University, Department of Economics.
- Giancarlo Moschini, 1995. "Units of Measurement and the Stone Index in Demand System Estimation," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 77(1), pages 63-68.
- Coad, Alex & de Haan, Peter & Woersdorfer, Julia Sophie, 2009.
"Consumer support for environmental policies: An application to purchases of green cars,"
Elsevier, vol. 68(7), pages 2078-2086, May.
- Alex Coad & Peter de Haan & Julia Sophie Woersdorfer, 2008. "Consumer support for environmental policies: An application to purchases of green cars," Jena Economic Research Papers 2008-035, Friedrich-Schiller-University Jena.
- Mills, Bradford F. & Schleich, Joachim, 2009.
"What's driving energy efficient appliance label awareness and purchase propensity?,"
Working Papers "Sustainability and Innovation"
S1/2009, Fraunhofer Institute for Systems and Innovation Research (ISI).
- Mills, Bradford & Schleich, Joachim, 2010. "What's driving energy efficient appliance label awareness and purchase propensity?," Energy Policy, Elsevier, vol. 38(2), pages 814-825, February.
When requesting a correction, please mention this item's handle: RePEc:bcc:wpaper:2011-07. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sergio Faria)
If references are entirely missing, you can add them using this form.