Rational Information Acquisition and Energy Efficiency

Last registered on October 23, 2020

Pre-Trial

Trial Information

General Information

Title
Rational Information Acquisition and Energy Efficiency
RCT ID
AEARCTR-0006656
Initial registration date
October 21, 2020
Last updated
October 23, 2020, 9:41 AM EDT

Locations

Primary Investigator

Affiliation
University of Queensland

Other Primary Investigator(s)

PI Affiliation
University of Pittsburgh
PI Affiliation
University of Illinois at Urbana-Champaign

Additional Trial Information

Status
In development
Start date
2020-10-21
End date
2020-12-31
Secondary IDs
Abstract
This experiment tests whether consumers optimally acquire information about product attributes when making purchase decisions. We develop a theoretical model of consumer choice that shows that rational consumers should acquire information about a product attribute based on their ex-ante beliefs about it: 1) when it is most likely to be pivotal to their choice, 2) when they are more uncertain, and 3) if they face lower information costs. We then show that for information acquisition to be optimal, the value of information should increase 1:1 with consumers’ willingness to pay for it. If consumers’ initial beliefs about that attribute are biased, their information choices may not be optimal. We experimentally test whether the three conditions hold for rational information acquisition based on ex-ante beliefs. Then, we test whether information choices were optimal ex-post. If not, we explore whether the bias in ex-ante beliefs has implications for the welfare effects of information acquisition.
External Link(s)

Registration Citation

Citation
Ding, Yue, Andrea La Nauze and Erica Myers. 2020. "Rational Information Acquisition and Energy Efficiency." AEA RCT Registry. October 23. https://doi.org/10.1257/rct.6656-1.0
Experimental Details

Interventions

Intervention(s)
Energy Efficiency Information
Intervention Start Date
2020-10-22
Intervention End Date
2020-12-31

Primary Outcomes

Primary Outcomes (end points)
Willingness to pay for information
The change in willingness to pay for bulbs after receiving information about lifetime energy costs
Value of information
Primary Outcomes (explanation)
Willingness to pay for information and lightbulbs is inferred from an incentive-compatible BDM style mechanism. The value of information is also inferred from the change in willingness to pay measured using repeated incentive-compatible BDM mechanisms and prices offered in the experiment.

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
We elicit participants’ beliefs about lifetime energy costs, willingness to pay for information about lightbulbs’ lifetime energy costs, and cost of effort.
We generate random variation in whether participants have access to the information conditional on their willingness to pay.
Experimental Design Details
Randomization Method
Randomization done by a computer.
Randomization Unit
Individual
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
2000
Sample size: planned number of observations
2000
Sample size (or number of clusters) by treatment arms
The treatment share is an outcome of the experiment. The probability of treatment is conditional on willingness to pay for information and is on the interval [0,1].
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB

Institutional Review Boards (IRBs)

IRB Name
University of Pittsburgh Human Research Protection Office
IRB Approval Date
2020-09-22
IRB Approval Number
STUDY20090047

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