Effectiveness of monetary information in promoting the purchase of energy-efficient appliances: Evidence from a field experiment in Spain

Abstract

The effectiveness of energy labels is crucial in nudging the adoption of energy-efficient products. Here we analyse how providing monetary information on the cost of energy affects the purchases of energy-efficient appliances. To that end, a field experiment was carried out at a major Spanish retailer. The appliances under study were washing-machines, fridges, dishwashers and tumble-driers. Monetary information was provided in two different ways: (i) directly by sales staff; and (ii) directly by sales staff and via a supplementary label. We find that providing monetary information is not always effective to increase the purchases of more energy-efficient appliances. Moreover, the effectiveness is different depending on both the appliance and the specific way in which information is provided. The monetary information provided only by sales staff is effective in promoting purchases of A++ washing-machines, fridges and dishwashers but no effect is found for tumble-driers. Monetary information given out by sales staff together with the supplementary label is effective in increasing purchases of A++ washing-machines and dishwashers and A+++ tumble-driers, but no effect is found for fridges. Prior to the experiment, a rebate programme for energy-efficient appliances was in place for a few months in some regions. We find that this rebate programme had an impact on purchases of those types of appliances even after it ended. This “memory effect” should be considered when analysing the effectiveness of such rebate programmes. © 2022