This paper exploits unique features of a
recently introduced tariff schedule for natural gas in
Buenos Aires to estimate the short-run impact of price
shocks on residential energy utilization. The schedule
induces a nonlinear and non-monotonic relationship between
households' accumulated consumption and unit prices,
thus generating exogenous price variation, which is
exploited in a regression-discontinuity design. The results
reveal that a price increase causes a prompt and significant
decline in gas consumption. They also indicate that
consumers respond more to recent past bills than to expected
prices, which argues against the assumption that consumers
have perfect awareness of complex price schedules.
Bibliographic Details
| Main Authors: |
Bastos, Paulo,
Castro, Lucio,
Cristia, Julian,
Scartascini, Carlos |
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| Language: | English
en_US |
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| Published: |
World Bank, Washington, DC
2014-02
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| Subjects: | APPROACH,
AVERAGE PRICE,
AVERAGE PRICES,
BALANCE,
CAPS,
CHANGES IN PRICES,
CLIMATE,
CLIMATE CHANGE,
CONSUMER BEHAVIOR,
CONSUMERS,
CONSUMPTION LEVELS,
CONSUMPTION PATTERNS,
CRUDE OIL,
DEMAND FOR ELECTRICITY,
DEMAND FOR ENERGY,
DEMAND RESPONSE,
DEREGULATION,
DEVELOPMENT POLICY,
ECONOMETRIC ANALYSIS,
ECONOMETRICS,
ELASTICITY,
ELASTICITY OF DEMAND,
ELECTRIC UTILITY,
ELECTRICITY CONSUMPTION,
ELECTRICITY DEMAND,
ELECTRICITY PRICE,
ELECTRICITY PRICING,
ENERGY CONSUMPTION,
ENERGY DEMAND,
ENERGY ECONOMICS,
ENERGY MARKETS,
ENERGY POLICY,
ENERGY PRICE,
ENERGY PRICES,
ENVIRONMENTAL ECONOMICS,
ENVIRONMENTAL ISSUES,
FUNCTIONAL FORMS,
GAS CONSUMPTION,
GAS DISTRIBUTION,
GAS PRICES,
HOUSEHOLD ELECTRICITY CONSUMPTION,
HOUSEHOLD MEMBERS,
HOUSEHOLD SURVEY,
HOUSEHOLDS,
IMPERFECT INFORMATION,
INCOME,
INCOME ELASTICITY OF DEMAND,
INDUSTRIAL ECONOMICS, |
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| Online Access: | http://documents.worldbank.org/curated/en/2014/02/19125889/energy-consumption-respond-price-shocks-evidence-regression-discontinuity-design
https://hdl.handle.net/10986/17336
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