Encouraging Energy Efficiency: Product Labels Activate Temporal Tradeoffs

Abstract

The current research presents the 10-year energy label as an effective nudge to increase energy efficient choices by retail consumers. Its efficacy is demonstrated in both lab and field studies (Studies 1a and 1b) and compared to other energy labels (Studies 4 and 5). The current work proposes that it is effective partly because many consumers have a latent dollar cost-reduction goal. Normally, when consumers purchase energy using products, they do not think about long-term costs. However, the 10-year energy label activates this latent goal in the presence of an appropriate behavioral path to achieving the goal, increasing the proportion of energy efficient choices (Studies 3 and 4). Thus, this nudge is somewhat selective, having its greatest impact on consumers who self-report actively pursuing long-term cost reduction goals (Study 5).