کد مقاله | کد نشریه | سال انتشار | مقاله انگلیسی | نسخه تمام متن |
---|---|---|---|---|
5060677 | 1371809 | 2012 | 5 صفحه PDF | دانلود رایگان |

From the previous literature, it can be found that consumers tend to undervalue discounted future energy costs in their purchase decisions for energy-using durables. We show that this finding could, in part, result from ignoring consumer heterogeneity in empirical analyses as opposed to true undervaluation.
⺠We provide evidence that previous estimates of the energy paradox are downward biased. ⺠Previous estimates of the relationship between lifetime fuel cost and vehicle price have ignored consumer heterogeneity. ⺠Heterogeneous consumer sorting across the product space may erroneously suggest undervaluation where none exists. ⺠Using realistic data generating parameters we estimate the size of the undervaluation with a Monte Carlo simulation. ⺠Naïve estimation techniques recover undervaluation on the order of previous estimates in the literature.
Journal: Economics Letters - Volume 115, Issue 1, April 2012, Pages 44-48