Minimum Energy Efficiency Standards and Appliances: Old and New Economic Rationales
Publication Type
Journal Article
Date Published
09/2016
Authors
DOI
Abstract
We revisit Hausman and Joskow (1982)'s economic rationales for appliance minimum energy efficiency standards. In addition to the four market failures they argued could justify appliance standards—energy prices below marginal social cost, consumers underestimating energy prices, consumer discount rates above social discount rates, or principal agent problems—we discuss two additional market failures that are relevant and potentially economically important in this context: market power and innovation market failures. We highlight puzzles uncovered by recent empirical results, and suggest directions future research should take to better understand the normative implications of appliance standards.
Journal
Economics of Energy & Environmental Policy
Volume
5
Year of Publication
2016
Issue
2
ISSN
ISSN 2160-5882 (Print), ISSN 2160-5890 (Online)