Individuals' Preferences for Permanence and Co-Benefits in Offsetting

Last registered on February 06, 2024
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Pre-Trial

Trial Information

General Information

Title
Individuals' Preferences for Permanence and Co-Benefits in Offsetting
RCT ID
AEARCTR-0012278
Initial registration date
October 18, 2023

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
October 23, 2023, 9:29 AM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Last updated
February 06, 2024, 10:47 AM EST

Last updated is the most recent time when changes to the trial's registration were published.

Locations

Country
Germany
Region

Primary Investigator

Name
Lara Bartels
Affiliation
ZEW – Leibniz Centre for European Economic Research
Contact Primary Investigator

Other Primary Investigator(s)

Additional Trial Information

Status
In development
Start date
2023-10-29
End date
2024-02-28
Keywords
Behavior, Environment & Energy
Additional Keywords
JEL code(s)
C83, C93, Q51, Q54
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
This study investigates the evolving landscape of carbon offsetting and consumer preferences. While carbon offsetting alone cannot fully address the climate crisis, its impact remains significant. The global offsetting market has seen rapid growth, reaching a value of $2 billion in 2021. Nevertheless, offsets from the voluntary carbon market are associated with considerable permanence uncertainties, casting doubt on their long-term climate impact and their contribution to net-zero goals. These concerns are particularly salient for nature-based offsets, such as forestry projects, given the risks associated with natural hazards and land-use changes. At the same time, nature-based offsets are offered at relatively low costs and provide a range of valuable co-benefits, making them 'charismatic carbon' offsets, and therefore particularly appealing to consumers. To explore individual preferences in carbon offsetting, this study employs an incentivized framed-field experiment. We aim to understand how consumers assess the importance of prices, permanence, and co-benefits when making offsetting decisions. First, I investigate subjective beliefs about the permanence and co-benefits of available offsetting options, addressing potential knowledge gaps and misconceptions among consumers. Second, I explore whether providing information about the permanence issues associated with offsets affects their perceived market value.
External Link(s)

Registration Citation

Citation
Bartels, Lara. 2024. "Individuals' Preferences for Permanence and Co-Benefits in Offsetting ." AEA RCT Registry. February 06. https://doi.org/10.1257/rct.12278-3.0
Sponsors & Partners
Experimental Details

Interventions

Intervention(s)
Participants will be invited to take part in an online survey, for which they will receive a fixed participation fee. The survey is structured in three elements:
1. Pre-experimental questionnaire
2. Incenivized Willingness to pay (WTP) questions under different treatments
3. Post-experimental questionnaire
Intervention Start Date
2023-10-29
Intervention End Date
2024-02-28

Primary Outcomes

Primary Outcomes (end points)
The main outcomes of interest are 1) the prior beliefs regarding permanence and co-benefits as well as 2) the WTP answers under the different treatment conditions.

Regarding the WTP answers, I will addtionally control for the following survey estimates:
- Impact of climate attitudes on WTP answers under different treatments.
- Impact of prior offsetting behavior, attitudes and knowledge of different offsetting options on WTP answers under different treatments.
- Impact of prior beliefs concerning effectiveness of offsetting options on WTP answers under different treatments.
- Impact of prior beliefs concerning permanence and co-benefits WTP answers under different treatments.
- Impact of socio-economics (age, gender, education, income) on WTP answers under different treatments.
- Impact of economic preferences (altruism, risk, time) on WTP answers under different treatments.

Further, I will check the impact of the treatment through three belief updating questions, regarding effectivess, permanence and co-benefits. Hypothising that compared to the control (T1):
- permanence beliefs are corrected (compared to the priors) under T2 and T3.
- effectiveness beliefs are corrected (compared to the priors) under and T3.
- co-benefits beliefs are corrected compared to the priors in all treatments.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
The remaining survey questions are ought to be used as control variables and for sub-goup analyses in the data analysis.
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Participants answer four Willingness to Pay (WTP) questions and are asked to allocate an amount of money (25 EUR) between themselves and two different carbon offsetting projects. This last WTP question is presented under three different treatments that provide different information about the permanence and the co-benefits of the specified offset project.
Experimental Design Details

The WTP questions are designed to investigate whether providing information about the permanence issues of offsets alters their market value. Participants are asked to decide two times how to allocate the 25 Euros between themselves and offsetting. Each decision involves allocating 25 Euros among themselves and two EU-based offsetting options: contributions to an afforestation project (high co-benefits, low permanence) and contributions to retire EU-Emissions Trading Scheme certificates (low co-benefits, high permanence).

Before making the first contribution decision, participants are randomly allocated to one of three treatment groups, with each treatment offering distinct sets of information regarding the permanence of CO2 reduction for both offset options. Thus, the first incentivized voluntary contribution to the climate protection project allows to identify the impact of providing different levels of permanence information on the decision to offset, as compared to the control group.

Prior to the two contribution stages, the three groups receive distinct information on the permanence of CO2 reduction for both offset options. Before the first contribution, the control group (T1) receives only information on the mitigation impact of each Euro spent for both offset options. This is how much carbon they can offset for a ton of CO2. To make the information about the amount of carbon more salient, additional information about an equivalent car trip in kilometers is provided. T2 includes T1's information with added permanence details for both carbon removal for both tree planting and the EU-ETS. T3 mirrors T2 but adjusts the non-permanent afforestation offset for its permanent offset amount based on Groom and Venmans (Nature, 2023), who estimate a non-permanent offset sequestering one ton for 50 years as equivalent to between 0.33 and 0.5 tons permanently locked away.

After having distributed the 25 Euros among the three different options for the first time, participants receive a second set of information before their second contribution decision. The information again see the information provided to them before their first contribution decision, but now, participants are presented with additional details regarding the co-benefits of both offsetting options. Thus, the second incentivized voluntary contribution to the climate protection project serves as within treatment control and allows to identify the impact of providing co-benefit information on the decision to offset.
Randomization Method
Online survey implemented with LimeSurvey, which creates a randnumber that randomly assigns participants to the different treatments.
Randomization Unit
Randomization takes place at the individual level.
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
No clusters
Sample size: planned number of observations
Pre-test: 240 participants Main experiment: 1.000 participants
Sample size (or number of clusters) by treatment arms
Pre-test: Participants are evenly allocated to the treatment arms.
Main experiment: Participants are evenly allocated to the treatment arms.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Will be performed based on the pre-test.
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
GfeW German Association for Experimental Economic Research e.V.
IRB Approval Date
2023-10-18
IRB Approval Number
Institutional Review Board Certificate No. nVSRDSf9
Analysis Plan

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials