ADOPTION OF ENERGY-EFFICIENT AIR CONDITIONERS AND THE PRINCIPAL-AGENT PROBLEM: EVIDENCE FROM CHINA

Xiao-Bing Zhang, Chang Su, Wenji Zhou*, Ping Qin

*Corresponding author for this work

Research output: Contribution to journalJournal articleResearchpeer-review

Abstract

As an important measure for households’ adaptation to climate change, air conditioning is becoming more and more prevailing in developing countries, which implies a larger demand for electricity and highlights the role of energy-efficient air conditioners (ACs) in energy saving. Using household-level data from China, this paper investigates the determinants of households’ adoption of energy-efficient ACs, with a focus on the role of the split-incentive (principal-agent) problem between homeowners and renters in the adoption of energy-efficient ACs. The results show that the principal-agent (PA) problem does exist in the adoption of energy-efficient ACs in Chinese households, with renter-occupied dwellings being about 10.2% more likely to have low energy-efficient ACs installed in dwellings, compared to homeowner-occupied dwellings. Moreover, the increased energy consumption and carbon emissions due to the PA problem in AC investment are calculated based on the estimated agency effect.
Original languageEnglish
Article number2350025
JournalClimate Change Economics
Volume0
Number of pages20
ISSN2010-0078
DOIs
Publication statusAccepted/In press - 2024

Keywords

  • Household energy consumption
  • Energy-efficient ACs
  • Principal-agent problem
  • Ordered probit model

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