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Copyright of Zeitschrift fur Wirtschaftspolitik is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Based on panel data on around 5500 German households, this article analyzes whether the experience of financial losses due to the Corona pandemic has affected three kinds of personal traits and preferences: the willingness to take risks, patience, and the locus of control (LOC). Our empirical results indicate that patience and the LOC remain unchanged by the experience of pandemic‐related financial losses, whereas we find a negative effect of severe financial losses on risk‐taking, contrasting with the traditional assumption that such preferences are constant. In this respect, our heterogeneity analysis indicates that financial losses due to the Corona pandemic particularly affect the most vulnerable households, notably low‐income households and those with little income diversification. [ABSTRACT FROM AUTHOR]

Copyright of Perspektiven der Wirtschaftspolitik is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Recent research suggests that households increase their electricity consumption after installing photovoltaic (PV) panels, a behavioral change commonly referred to as the solar rebound. Using panel data originating from the German Residential Energy Consumption Survey, we investigate the existence of a solar rebound effect. Our empirical results suggest that PV panel adoption does not change the amount of electricity that households take from the grid. As we derive theoretically, this implies a solar rebound bounded from above by about 50%, while back-of-the-envelope calculations suggest a lower bound of 12% and an average solar rebound of 35%. [ABSTRACT FROM AUTHOR]

Copyright of Perspektiven der Wirtschaftspolitik is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Germany is a rather water-rich country. Nevertheless, climatic changes might make it necessary to use water resources carefully in the future, especially in times of drought. Against this background, this paper estimates the price elasticity of household water consumption, differentiating between households that have a rough knowledge of water prices and households that do not. Based on about 1,100 observations for households living in single-family houses and using the sum of cubic meter prices for water and wastewater as price measure, we find a moderate but statistically significantly non-zero price elasticity of -0.102. Households that have knowledge of water prices tend to exhibit a higher elasticity, while households without price knowledge do not show a statistically significant response in their water consumption. Prices can thus only be used to a limited extent as a means of controlling water consumption. [ABSTRACT FROM AUTHOR]

Based on hypothetical responses from a large-scale survey among about 6,000 German households, this study investigates the discrepancy in willingness-to-pay (WTP) estimates for green electricity across single-binary-choice and open-ended valuation formats. Recognizing that respondents self-select into two groups distinguished by their beliefs in their answers' consequences for policy making, we use a switching regression model that accounts for the potential endogeneity of respondents' beliefs in consequences and biases from sample selectivity. Contrasting with the received literature, we find that WTP bids tend to be higher among those respondents who received questions in the open-ended, rather than in the single-binary-choice format. (JEL C35) [ABSTRACT FROM AUTHOR]

Empirical evidence on households' awareness of electricity prices and potentially divergent demand responses to price changes conditional on price knowledge is scant. Using panel data originating from Germany's Residential Energy Consumption Survey (GRECS), we fill this void by employing an instrumental-variable (IV) approach to cope with the endogeneity of the consumers' tariff choice. By additionally exploiting information on the households' knowledge about power prices, we combine the IV approach with an Endogenous Switching Regression Model to estimate price elasticities for two groups of households, finding that only those households that are informed about prices are sensitive to price changes, whereas the electricity demand of uninformed households is entirely price-inelastic. Based on these results, to curb the electricity consumption of the household sector and its environmental impact, we suggest implementing low-cost information measures on a large scale, such as improving the transparency of tariffs, thereby increasing the saliency of prices. [ABSTRACT FROM AUTHOR]

Based on a survey among more than 5,000 German household heads, this article investigates their willingness to pay (WTP) for avoiding power outages using Contingent-Valuation-Methods (CVM). Alternatively, we ask respondents to estimate the WTP of a hypothetical household. This Inferred-Valuation-Method (IVM) is an approach introduced to reduce the hypothetical bias of stated WTP. Our empirical results indicate that, relative to the CVM, the IVM yields inflated WTP values, casting doubt on the validity of the IVM. [ABSTRACT FROM AUTHOR]

Using household travel diary data collected in Germany between 1997 and 2015, we employ an instrumental variable (IV) approach that enables us to consistently estimate both fuel price and efficiency elasticities. The aim is to gauge the relative impacts of fuel economy standards and fuel taxes on distance traveled. Our elasticity estimates indicate that higher fuel prices reduce driving to a substantial extent, though not to the same degree as higher fuel efficiency increases driving. This finding indicates an offsetting effect of fuel efficiency standards on the effectiveness of fuel taxation, calling into question the efficacy of the European Commission’s legislation to limit carbon dioxide emissions for new cars. [ABSTRACT FROM AUTHOR]

The overestimation of willingness-to-pay (WTP) in hypothetical responses is a well-known finding in the literature. Various techniques have been proposed to remove or, at least, reduce this bias. Using about 30,000 responses on WTP for a variety of power mixes from a panel of 6500 German households and the fixed-effects estimator to control for unobserved heterogeneity, this article simultaneously explores the effects of two common ex-ante approaches-cheap talk and consequential script-and the ex-post certainty approach to calibrating hypothetical WTP responses. Based on a switching regression model that accounts for the potential endogeneity of respondent certainty, we find evidence for a lower WTP among those respondents who classify themselves as definitely certain about their answers. Although neither cheap talk nor the consequential-script corrective reduce WTP estimates, receiving either of these scripts increases the probability that respondents indicate definite certainty about their WTP bids. [ABSTRACT FROM AUTHOR]

The perception of risks associated with climate change appears to be a key factor for the support of climate policy measures. Using a generalized ordered logit approach and drawing on a unique data set originating from two surveys conducted in 2012 and 2014, each among more than 6000 German households, we analyze the determinants of individual risk perception associated with three kinds of natural hazards: heat waves, storms, and floods. Our focus is on the role of objective risk measures and experience with these natural hazards, whose frequency is likely to be affected by climate change. In line with the received literature, the results suggest that personal experience with adverse events and personal damage therefrom are strong drivers of individual risk perception. [ABSTRACT FROM AUTHOR]

This paper presents evidence that the accumulating cost of Germany's ambitious plan to transform its system of energy provision--the so-called Energiewende--is butting up against consumers' willingness-to-pay (WTP) for it. Following a descriptive presentation that traces the German promotion of renewable energy technologies since 2000, we draw on two stated-preference surveys conducted in 2013 and 2015 that elicit the households' WTP for green electricity. Two models are estimated, one based on a closed-ended question framed around Germany's target of 35% renewable energy in electricity provision by 2020, and the other on an open-ended format that captures changes in WTP over time. To deal with the bias that typifies hypothetical responses, the models distinguish respondents according to whether they express definite certainty in their reported WTP. The results from both models reveal a strong contrast between the households' general acceptance of supporting renewable energy technologies and their own WTP for green electricity. [ABSTRACT FROM AUTHOR]

This article investigates the pass-through of global Brent oil notations to fuel prices across the oligopoly of retail majors in Germany. We assemble a high-frequency panel data set that encompasses millions of price observations and allows us to distinguish effects by brand. Upon establishing a cointegrating relationship between fuel and crude oil prices using daily data, we estimate an ECM and find that (1) the pass-through of oil prices critically depends on the number of time lags included in the ECM; (2) strict adherence to classical information criteria for determining lag length yields extremely long pass-through durations and (3) the estimated impulse response functions are virtually identical across brands, irrespective of the lag count, suggesting a high degree of competition among brands. [ABSTRACT FROM AUTHOR]

Using detailed data originating from several hundred households of the German Residential Energy Survey (GRECS), this paper empirically investigates the returns on investment in photovoltaic (PV) installations. We find that these returns were particularly high in the years 2009 to 2011, when large subsidies for solar electricity coincided with plummeting module prices. While our empirical analysis demonstrates that such investments also incur substantial risks, there is evidence that, above all, wealthy households tend to benefit from the solar subsidies, whereas the costs of financing these subsidies are borne by electricity consumers at large, not least poverty-endangered households. The resulting redistribution of financial resources raises the question of whether the burden-sharing of Germany’s transition to an alternative energy system is fair. [ABSTRACT FROM AUTHOR]

Germany's energy transition has been accompanied by a near doubling of power prices for private households since the outset of the new millennium. Millions of poor households and those that are close to the poverty threshold are likely to suffer from the increase in electricity cost. Focusing on low-income households, this paper illustrates the distributional implications of Germany's energy transition by investigating their electricity cost burden between 2006 and 2012, using data from the German Residential Energy Consumption Survey (GRECS). Our estimates suggest that in 2012, on average, households at poverty risk allocated 5.5% of their income to power and, hence, paid nearly as much for covering their electricity consumption as for heating purposes. Given Germany's ambitious targets to expand the share of costly renewable technologies in electricity consumption, which has broad support among the electorate, it is to be expected that households' expenditure for power will increase in the upcoming years. This raises the urgent question of how to mitigate the regressive impact of further increasing electricity prices on poor households. Direct cash transfers are suggested here as a non-distortionary instrument for easing the burden of high prices, one that is directly targeted at those endangered by energy poverty. [ABSTRACT FROM AUTHOR]

This article revisits an analysis by Frondel et al. (2008) on the promotion of photovoltaics (PV) in Germany, a technology that enjoys particularly high subsidies in the form of feedin tariffs. The result is explosive costs with little to show for either environmental or employment benefits. Indeed, we document that the immense costs foreseen by Frondel and colleagues have materialized: our updated estimate of the subsidies for PV, at e 108 Bn, even exceeds their expectations. Moreover, with installed PV capacities growing at a rapid rate, these costs will continue to accumulate, diverting resources from more cost-effective climate protection instruments. [ABSTRACT FROM AUTHOR]

Abstract: The voluntary nature of programs that pay landowners for conservation measures raises the question of what factors favor participation in such programs. This article focuses on the controversial issue of the impact of information on the participation decision. We develop a straightforward model to analyze how information affects this decision, and empirically estimate the impact of information, as well as other factors, on participation in a conservation program in Saxony, Germany. We find in our theoretical analysis that information measures may affect program participation either in a positive or negative way, whereas our estimation results indicate that the influence of the diverse information measures that have been relevant in our empirical analysis is weak. We argue, however, that information measures may nonetheless be warranted, as they allow for better informed participation decisions, thus contributing to a more optimal selection of program participants. [Copyright &y& Elsevier]

Abstract: Focusing on adult members of German households, this paper investigates the determinants of public transit ridership with the aim of quantifying the effects of fuel prices, fares, person-level attributes, and characteristics of the transit system on transport counts over a five-day week. The reliance on individual data raises several conceptual and empirical issues, the most fundamental of which is the large proportion of zero values in transit counts. To accommodate this feature of the data, we employ modeling procedures referred to as zero-inflated models (ZIMs), which order observations into two latent regimes defined by whether the individual never uses public transport. Our estimates reveal fuel prices to have a positive and substantial influence on transit ridership, though there is no evidence for a statistically significant impact of the fare. [Copyright &y& Elsevier]

The allure of an environmentally benign, abundant, and cost-effective energy source has led an increasing number of industrialized countries to back public financing of renewable energies. Germany's experience with renewable energy promotion is often cited as a model to be replicated elsewhere, being based on a combination of far-reaching energy and environmental laws that stretch back nearly two decades. This paper critically reviews the centerpiece of this effort, the Renewable Energy Sources Act (EEG), focusing on its costs and the associated implications for job creation and climate protection. We argue that German renewable energy policy, and in particular the adopted feed-in-tariff scheme, has failed to harness the market incentives needed to ensure a viable and cost-effective introduction of renewable energies into the country's energy portfolio. To the contrary, the government's support mechanisms have in many respects subverted these incentives, resulting in massive expenditures that show little long-term promise for stimulating the economy and protecting the environment. [ABSTRACT FROM AUTHOR]

Focusing on travel survey data from Germany, this paper investigates the determinants of automobile travel, with the specific aim of quantifying the effects of fuel prices and fuel economy. The analysis is predicated on the notion that car mileage is a two-stage decision process, comprising the discrete choice of whether to own a car and the continuous choice of distance traveled. To capture this process, we employ censored regression models consisting of Probit and OLS estimators, which allows us to gauge the extent to which sample selectivity may bias the results. Our elasticity estimates indicate a significant positive association between increased fuel economy and increased driving, and a significantly negative fuel-price elasticity, which ranges between − 35% and − 41%. Taken together, these results suggest that fuel taxes are likely to be a more effective policy measure in reducing emissions than fuel-efficiency standards. [ABSTRACT FROM AUTHOR]

Along with the oil price, concerns about the security of energy supply have soared once again in recent years. Yet, more than 30 years after the OPEC oil embargo in 1973, energy security still remains a diffuse concept. This article conceives a statistical indicator that aims at characterizing the long-term energy supply risk of nations that are heavily dependent on energy imports. Our indicator condenses the bulk of empirical information on the imports of fossil fuels originating from a multitude of export countries as well as data on the indigenous contribution to the domestic energy supply, thereby providing us with a single parameter. Applying the proposed concept to empirical energy data on Germany (1980–2004), we find that the energy supply risk has increased substantially since the 1970s. This outcome is mainly due to the drastic raise of oil and gas imports from Russia. [ABSTRACT FROM AUTHOR]

Using a panel of household travel diary data collected in Germany between 1997 and 2005, this study assesses the effectiveness of fuel efficiency improvements by estimating the rebound effect, which measures the extent to which higher efficiency causes additional travel. Following a theoretical discussion outlining three alternative definitions of the rebound effect, the econometric analysis generates corresponding estimates using panel methods to control for the effects of unobservables that could otherwise produce spurious results. Our results, which range between 57% and 67%, indicate a rebound that is substantially larger than obtained in other studies, calling into question the efficacy of policies targeted at reducing energy consumption via technological efficiency. [ABSTRACT FROM AUTHOR]

Abstract: Naturally, before funding an environmental program on a large scale, decision makers would like to know whether or not a program will be successful in terms of, first, ecological efficacy and, second, economic efficiency. With particular focus on methodological issues regarding the evaluation of environmental programs, this paper provides an introductory and didactic survey of experimental and observational approaches to the evaluation of the ecological efficacy, as suggested by modern evaluation research. While the evaluation of environmental programs on the basis of these approaches is standard in the US, this course outlined by other applied fields, such as labor and health economics, is obviously rather unusual in Germany and other EU countries. We would like to emphasize that, whenever possible, one should consider conducting an experimental study: In an ideal experiment with a randomized assignment into treatment and control groups, the simple difference in mean outcomes across both groups would yield an unbiased estimate of the true program effect. When controlled experiments are not a viable option, observational approaches might succeed. In any case, environmental regulators and utilities have to work more closely together with researchers already at the stage of designing the interventions. [Copyright &y& Elsevier]