Monday, January 25, 2016

Can indifference make the world greener?

We conducted a natural field experiment to evaluate two resource conservation programs. One intervention consisted of a moral appeal message asking university employees to cut back on printing in general, and to use double-sided printing whenever possible. The other intervention tested whether people׳s tendency to stick with pre-set alternatives is applicable to resource use: at random points in time we changed the default setting on the university printers, from single-sided to double-sided printing. Whereas the moral appeal had no impact, the default change cut paper use by 15 percent. Further analysis adds two important insights. First, we show that defaults influence behavior also in the longer run. Second, we present results indicating that resource efficient defaults have the advantage of avoiding unintended behavioral responses. Overall, our findings send a clear message to anyone concerned about resource conservation: there are potentially large gains to be made from small interventions.

According to a March, 2014 version of the paper available free of charge at the authors:
find a substantial and immediate default effect. On average, daily paper consumption drops by 15 percent due to the change, and this reduction occurs the very day of the intervention. Put differently, the default determines how one third of all documents is printed. To illustrate the potential impact in a broader perspective, back of the envelope calculations suggest that a switch to a green default in U.S. offices would save 270,000 metric tons of paper ($415,000,000) annually. This amount of paper causes a carbon foot print that is in the order of 780,000 metric tons of CO2-equivalents; as a comparison 150,000 cars would need to be pulled off the roads to generate a similar reduction in greenhouse gas emissions.  Second, we present findings indicating that changing the default to duplex is welfare enhancing per se, since it helps people to make the choice they seem to prefer (Johnson et al., 2012). Specifically, the magnitude of the effect does not diminish over time; more than six months after the intervention, paper consumption is still at the new lower level. The fact that people do not revert back to simplex printing in the long run suggests that the intervention does not inconvenience them. From a practical standpoint it is also important to stress that users are most active when simplex is the default. Third, we show that printing demand is independent of the default option, meaning that the drop in paper usage is only due to an increase in the fraction of duplex sheets. This result is important since it shows that using defaults as a policy tool avoids unintended adverse effects. As a comparison, Catlin and Wang (2013) find that people increase their paper usage when the possibility to recycle is introduced, and both Schultz et al. (2007) and Ayres et al. (2009) report that providing information about neighbors’ energy usage causes some individuals to increase their consumption. Finally, we show that encouraging people to use duplex printing as much as possible has no effect. This clearly indicates that trying to convince people to take responsibility, by simply asking, is inefficient.

Nudge, Nudge, Say No More
by Johan Egebark 1, Mathias Ekström 1 and 21. Research Institute of Industrial Economics (IFN), Stockholm, Sweden
2. Department of Economics, Norwegian School of Economics (NHH), Helleveien 30, N-5045 Bergen, Norway
Journal of Environmental Economics and Management via Elsevier Science Direct
Volume 76; March, 2016; Pages 1–13, Available online 26 November 2015
Keywords: Resource conservation; Default option; Moral appeal; Natural field experiment

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