Experimental Design
In Part 1, we will elicit respondents’ personal preferences (including risk preferences and loss aversion measures), beliefs and attitudes around solar power, energy and the global crisis, as well as environmental issues. More specifically, following the best practice guidance provided by Fuster and Zafar (2021) and Haaland et al. (2021), the subject beliefs that we would solicit from firm decision makers would include:
• Benefits of solar energy (financial savings, power stability, GHG emissions, health etc.);
• Costs of solar energy (installation, operations and maintenance, administrative procedures);
• Future electricity price increases (of solar and other green alternatives, as well as non-green sources);
• Future electricity shortages (hours of electricity outages per day or “load shedding”);
• Solar energy usage by other firms in the same sector;
• Requirements of international buyers for green energy usage in export production;
• Requirements for solar installation (roof space etc.);
• Awareness/understanding of available financing options;
Finally, we will also elicit respondents’ intended behaviour or expected likelihood of purchasing solar energy sources.
In Part 2, respondents will be randomly assigned either to a control group or to one of two information treatments targeting specific belief categories deemed to be the most relevant predictors of intentions and behavior in relation to purchasing solar energy.
In Part 3, we will re-elicit respondents’ beliefs and attitudes around solar energy, as well as the intended likelihood of purchasing it. In Part 4, we will ask a comprehensive battery of socio-demographic and standard firm characteristics. Based on the results of the analysis and on the available financial resources, we will try to investigate the longer-term impacts of information provision on beliefs, intentional and actual purchasing behavior from the same respondents in a follow-up survey two to three months later.
The primary data collected through this survey tool will allow us to carry out two main types of analysis. First, we will be able to examine how respondents’ preferences, prior beliefs and attitudes over solar power affect the likelihood of investing in this renewable energy. We will look at how the relative contribution of structural and behavioral barriers in hindering the adoption of solar energy across small-medium enterprises in central Punjab changes across different sectors and generations. Second, our field experiment embedded in the survey will allow us to compare the average likelihood of purchasing solar energy across different treatment groups and test whether objective information provision is effective at changing attitudes towards solar energy and intentions to purchase it. Overall, by providing a better understanding of SMEs managers’ decision-making process, the study will help policy makers design more effective policy instruments to support the market deployment of renewable energies such as solar power.