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Changes in the Pattern of Household Electricity Demand over Time

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    Empirical estimates of long run effects on residential electricity demand from changes in the electricity price are usually estimated by cross-sectional variation in the current stock of electric household appliances across households at a certain point in time. Here, we use a discrete-continuous approach modeling the long run effects by investments in new appliances. We apply the annual Norwegian Survey of Consumer Expenditure for the period 1975 to 1994 to estimate the short and long run own price elasticities in the two approaches. We find the estimated long run elasticity only slightly more price elastic than the short run. We also find that the long run elasticity does not differ significantly between the two approaches. The reason for both results is that, since there is no alternative source of energy for these appliances, there are no substitution effects.

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    File URL: http://www.ssb.no/a/publikasjoner/pdf/DP/dp255.pdf
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    Paper provided by Research Department of Statistics Norway in its series Discussion Papers with number 255.

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    Date of creation: Jun 1999
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    Handle: RePEc:ssb:dispap:255
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    1. Jean-Thomas Bernard & Denis Bolduc & Donald Belanger, 1996. "Quebec Residential Electricity Demand: A Microeconometric Approach," Canadian Journal of Economics, Canadian Economics Association, vol. 29(1), pages 92-113, February.
    2. E. Raphael Branch, 1993. "Short Run Income Elasticity of Demand for Residential Electricity Using Consumer Expenditure Survey Data," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 111-122.
    3. Dubin, Jeffrey A & McFadden, Daniel L, 1984. "An Econometric Analysis of Residential Electric Appliance Holdings and Consumption," Econometrica, Econometric Society, vol. 52(2), pages 345-62, March.
    4. Hsing, Yu, 1994. "Estimation of residential demand for electricity with the cross-sectionally correlated and time-wise autoregressive model," Resource and Energy Economics, Elsevier, vol. 16(3), pages 255-263, August.
    5. Haas, Reinhard & Biermayr, Peter & Zoechling, Josef & Auer, Hans, 1998. "Impacts on electricity consumption of household appliances in Austria: a comparison of time series and cross-section analyses," Energy Policy, Elsevier, vol. 26(13), pages 1031-1040, November.
    6. Rudolf K.-H. Dennerlein, 1987. "Residential Demand for Electrical Appliances and Electricity in the Federal Republic of Germany," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 69-86.
    7. Runa Nesbakken, 1998. "Price Sensitivity of Residential Energy Consumption in Norway," Discussion Papers 232, Research Department of Statistics Norway.
    8. Baker, Paul & Blundell, Richard, 1991. "The Microeconometric Approach to Modelling Energy Demand: Some Results for UK Households," Oxford Review of Economic Policy, Oxford University Press, vol. 7(2), pages 54-76, Summer.
    9. Runa Nesbakken, 1998. "Residential Energy Consumption for Space Heating in Norwegian Households A Discrete-Continuous Choice Approach," Discussion Papers 231, Research Department of Statistics Norway.
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