There is a new interesting paper just published in Environmental & Resource Economics entitled “Does Absolution Promote Sin? A Conservationist’s Dilemma“. The authors are Matthew Harding and David Rapson. What’s my take on this?
The main message is the following:
This paper shows that households signing up for a green program exhibit an intriguing behavioral rebound effect: a promise to fully offset customers’ carbon emissions resulting from electricity usage increases their energy use post-adoption by 1–3%.
This is simply a public versus private good setting and there are obviously many reasons for which individuals may want to contribute to public goods. The authors suggest this effect may be due to altruism or warm glow, due to guilt or moral licensing.
I think what this paper does is that it gives us a number for how much individuals reduce their energy consumption given that they know that this energy is carbon-intensive and adds to climate change. That number is 1-3%.
This is an important result as it gives us a sense of dimension for individuals’ own private commitments towards global climate change goals. Assuming that mankind somehow wants to achieve the 1.5°C target committed to in the Paris Agreement, then we need substantial emission reductions. For example, energy-related carbon emissions need to decrease by 70% until 2050 compared to 2015. Clearly, the results in this paper suggest that without policy intervention, the individuals’ efforts will be far too low. Given the large literature on private versus public goods this is of course a result that we anticipated, but what the authors manage is to give a number to this trade-off: 1-3%. Rather low.