Title

Price Knowledge In Household Demand For Utility Services

Abstract

A household's decision to acquire price knowledge is endogenous in the demand for utility services and may affect elasticities and consumption levels. A simultaneous equation model with endogenous switching is developed to evaluate the effects of price knowledge and other sources of heterogeneity. Results indicate informed households were more responsive to average and marginal price signals. Informed households also use less water, but this is due to heterogeneity rather than price knowledge. Controlling for heterogeneity, price knowledge actually increases monthly water usage. The implications of accounting for differences in price knowledge in utility demand modeling and demand management policy are discussed. © 2005 by the Board of Regents of the University of Wisconsin System.

Publication Date

1-1-2005

Publication Title

Land Economics

Volume

81

Issue

2

Number of Pages

265-283

Document Type

Article

Personal Identifier

scopus

DOI Link

https://doi.org/10.3368/le.81.2.265

Socpus ID

21444436309 (Scopus)

Source API URL

https://api.elsevier.com/content/abstract/scopus_id/21444436309

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