Social Learning about Environmental Innovations : Experimental Analysis of Adoption Timing
Laboratory experiments were conducted to investigate how private and public information affect the selection of an innovation and the timing of adoption. The results shed light on the behavioral anomaly called the “energy-efficiency gap” in which c...
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World Bank, Washington, DC
2017
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| Online Access: | http://documents.worldbank.org/curated/en/732971485375911214/Social-learning-about-environmental-innovations-experimental-analysis-of-adoption-timing http://hdl.handle.net/10986/25963 |
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okr-10986-259632021-06-08T14:42:47Z Social Learning about Environmental Innovations : Experimental Analysis of Adoption Timing Jamison, Julian C Owens, David Woroch, Glenn social learning endogenous timing behavioral economics technology diffusion environmental innovations energy efficiency technology adoption Laboratory experiments were conducted to investigate how private and public information affect the selection of an innovation and the timing of adoption. The results shed light on the behavioral anomaly called the “energy-efficiency gap” in which consumers and firms delay adoption of cost-effective energy and environmental innovations. The subjects chose between competing innovations with freedom to select the timing of their adoption, relying on private signals and possibly observation of their peers. When deciding whether to make an irreversible choice between safe and risky technologies, roughly half the subjects delayed adoption beyond the time indicated by equilibrium behavior -- confirming the behavioral anomaly found for environmental innovations. When they did adopt, the subjects gave proportionately more weight to their private signals than to the actions of their peers, implying they do not ‘herd’ on the latter. Nevertheless, when the subjects observed their peers’ decisions, they did accelerate the timing of their adoption despite not necessarily imitating their peers. This result occurred even when the payoffs were statistically independent, as if observing prior adoptions exerted ‘peer pressure’ on the subjects to act. The experimental results suggest that rapid dissemination of information about peer actions can speed up the diffusion of environmental innovations and improve selection among competing technologies. 2017-01-30T20:56:42Z 2017-01-30T20:56:42Z 2017-01 Working Paper http://documents.worldbank.org/curated/en/732971485375911214/Social-learning-about-environmental-innovations-experimental-analysis-of-adoption-timing http://hdl.handle.net/10986/25963 English en_US Policy Research Working Paper;No. 7955 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
social learning endogenous timing behavioral economics technology diffusion environmental innovations energy efficiency technology adoption |
| spellingShingle |
social learning endogenous timing behavioral economics technology diffusion environmental innovations energy efficiency technology adoption Jamison, Julian C Owens, David Woroch, Glenn Social Learning about Environmental Innovations : Experimental Analysis of Adoption Timing |
| relation |
Policy Research Working Paper;No. 7955 |
| description |
Laboratory experiments were conducted to
investigate how private and public information affect the
selection of an innovation and the timing of adoption. The
results shed light on the behavioral anomaly called the
“energy-efficiency gap” in which consumers and firms delay
adoption of cost-effective energy and environmental
innovations. The subjects chose between competing
innovations with freedom to select the timing of their
adoption, relying on private signals and possibly
observation of their peers. When deciding whether to make an
irreversible choice between safe and risky technologies,
roughly half the subjects delayed adoption beyond the time
indicated by equilibrium behavior -- confirming the
behavioral anomaly found for environmental innovations. When
they did adopt, the subjects gave proportionately more
weight to their private signals than to the actions of their
peers, implying they do not ‘herd’ on the latter.
Nevertheless, when the subjects observed their peers’
decisions, they did accelerate the timing of their adoption
despite not necessarily imitating their peers. This result
occurred even when the payoffs were statistically
independent, as if observing prior adoptions exerted ‘peer
pressure’ on the subjects to act. The experimental results
suggest that rapid dissemination of information about peer
actions can speed up the diffusion of environmental
innovations and improve selection among competing technologies. |
| format |
Working Paper |
| author |
Jamison, Julian C Owens, David Woroch, Glenn |
| author_facet |
Jamison, Julian C Owens, David Woroch, Glenn |
| author_sort |
Jamison, Julian C |
| title |
Social Learning about Environmental Innovations : Experimental Analysis of Adoption Timing |
| title_short |
Social Learning about Environmental Innovations : Experimental Analysis of Adoption Timing |
| title_full |
Social Learning about Environmental Innovations : Experimental Analysis of Adoption Timing |
| title_fullStr |
Social Learning about Environmental Innovations : Experimental Analysis of Adoption Timing |
| title_full_unstemmed |
Social Learning about Environmental Innovations : Experimental Analysis of Adoption Timing |
| title_sort |
social learning about environmental innovations : experimental analysis of adoption timing |
| publisher |
World Bank, Washington, DC |
| publishDate |
2017 |
| url |
http://documents.worldbank.org/curated/en/732971485375911214/Social-learning-about-environmental-innovations-experimental-analysis-of-adoption-timing http://hdl.handle.net/10986/25963 |
| _version_ |
1764460598315188224 |