Institutional Affiliation: Federal Reserve Bank of Philadelphia
|Formative Experiences and the Price of Gasoline|
with : w26091
An individual's initial experiences with a common good, such as gasoline, can shape their behavior for decades. We first show that the 1979 oil crisis had a persistent negative effect on the likelihood that individuals that came of driving age during this time drove to work in the year 2000 (i.e., in their mid 30s). The effect is stronger for those with lower incomes and those in cities. Combining data on many cohorts, we then show that large increases in gasoline prices between the ages of 15 and 18 significantly reduce both (i) the likelihood of driving a private automobile to work and (ii) total annual vehicle miles traveled later in life, while also increasing public transit use. Differences in driver license age requirements generate additional variation in the formative window. These...
|A Forward Looking Ricardian Approach: Do Land Markets Capitalize Climate Change Forecasts?|
with , : w22413
The hedonic pricing method is one of the fundamental approaches used to estimate the economic value of attributes that affect the market price of an asset. In environmental economics, such methods are routinely used to derive the economic valuation of environmental attributes such as air pollution and water quality. For example, the Ricardian approach is based on a hedonic regression of land values on historical climate variables. Forecasts of future climate can then be employed to estimate the future costs of climate change. This extensively-applied approach contains an important implicit assumption that current land markets ignore current climate forecasts. While this assumption was defensible decades ago (when this literature first emerged), it is reasonable to hypothesize that informat...
Published: Christopher Severen & Christopher Costello & Olivier Deschênes, 2018. "A Forward-Looking Ricardian Approach: Do land markets capitalize climate change forecasts?," Journal of Environmental Economics and Management, . citation courtesy of
|Technology Adoption Under Uncertainty: Take-Up and Subsequent Investment in Zambia|
with , , , : w21414
Many technology adoption decisions are made under uncertainty about the costs or benefits of subsequent investments in the technology after the initial take-up. As new information is realized, agents may prefer to abandon a technology that appeared profitable at the time of take-up. Low rates of follow-through (engagement in subsequent investments) are particularly problematic when subsidies are used to increase adoption, in part because they may attract users with a lower value for the technology. We use a field experiment with two stages of randomization to generate exogenous variation in the payoffs associated with taking up and following through with a new technology: a tree species that provides private fertilizer benefits to adopting farmers. Our empirical results show high rates of ...
Published: Paulina Oliva & B. Kelsey Jack & Samuel Bell & Elizabeth Mettetal & Christopher Severen, 2020. "Technology Adoption under Uncertainty: Take-Up and Subsequent Investment in Zambia," The Review of Economics and Statistics, MIT Press, vol. 102(3), pages 617-632, July.