Replication data for: Power to Choose? An Analysis of Consumer Inertia in the Residential Electricity Market
Principal Investigator(s): View help for Principal Investigator(s) Ali Hortaçsu; Seyed Ali Madanizadeh; Steven L. Puller
Version: View help for Version V1
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| AEJPOL-2015-0235-Replication-code | 10/13/2019 05:08:AM | ||
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text/plain | 14.6 KB | 10/13/2019 01:08:AM |
Project Citation:
Hortaçsu, Ali, Madanizadeh, Seyed Ali, and Puller, Steven L. Replication data for: Power to Choose? An Analysis of Consumer Inertia in the Residential Electricity Market. Nashville, TN: American Economic Association [publisher], 2017. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-13. https://doi.org/10.3886/E114647V1
Project Description
Summary:
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Many jurisdictions around the world have deregulated utilities and opened retail markets to competition. However, inertial decision making can diminish consumer benefits of retail competition. Using household-level data from the Texas residential electricity market, we document evidence of consumer inertia. We estimate an econometric model of retail choice to measure two sources of inertia: search frictions/inattention and a brand advantage that consumers afford the incumbent. We find that households rarely search for alternative retailers, and when they do search, households attach a brand advantage to the incumbent. Counterfactual experiments show that low-cost information interventions can notably increase consumer surplus.
Scope of Project
JEL Classification:
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D12 Consumer Economics: Empirical Analysis
D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
L81 Retail and Wholesale Trade; e-Commerce
L94 Electric Utilities
L98 Industry Studies: Utilities and Transportation: Government Policy
M31 Marketing
D12 Consumer Economics: Empirical Analysis
D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
L81 Retail and Wholesale Trade; e-Commerce
L94 Electric Utilities
L98 Industry Studies: Utilities and Transportation: Government Policy
M31 Marketing
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