Motivation Crowding in Peer Effects: The Effect of Solar Subsidies on Green Power Purchases

A-Tier
Journal: Review of Economics and Statistics
Year: 2023
Volume: 105
Issue: 6
Pages: 1465-1480

Score contribution per author:

4.022 = (α=2.01 / 1 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

I test whether economic incentives impact peer effects in public-good settings. I study how a visible and subsidized contribution to a public good (installing solar panels) affects peer contributions to the same good that are neither subsidized nor visible (electing green power). Exploiting spatial variation in the feasibility of installing solar panels, I find that on average panels increase voluntary purchases of green power by neighbors. However, when subsidies to solar are high, solar panels reduce peer contributions. The results support the hypothesis that signals drive peer responses to visible public-good contributions and that economic incentives alter those signals.

Technical Details

RePEc Handle
repec:tpr:restat:v:105:y:2023:i:6:p:1465-1480
Journal Field
General
Author Count
1
Added to Database
2026-01-25