Abstract
Although an increasing number of studies have demonstrated the short-term impacts of behavioral nudges to achieve public policy objectives, less is known about their longer-term impacts. In a randomized experimental design with over 100,000 households, we study the longer-term impacts of a one-time behavioral nudge that aimed to induce voluntary reductions in water use during a drought. Combining technical information, moral suasion, and social comparisons, the nudge has a surprisingly persistent effect. Although its effect size declines by almost 50% after 1 year, it remains detectable and policy-relevant six years later. In fact, the total reduction in water use achieved after the 4-month period targeted by the intervention is larger than the total reduction achieved during the target period. Further analysis suggests that the intervention works through both short-lived behavioral adjustments and longer-lived adjustments to habits or physical capital. Treatment effects are not detectable in homes from which the treated consumers have moved, which provides suggestive evidence that these longer-lived adjustments are mobile rather than incorporated into the housing stock. The persistence of the effect makes the intervention more cost-effective than previously assumed (cost drops by almost 60%). Nevertheless, water utilities may find this persistence undesirable if the nudges are intended to have only a short-run effect on demand during environmental emergencies.
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Notes
In a November 2013 interview with The Observer, the director of the UK’s Behavioral Insight Team acknowledged that the long-term effects of the impacts induced by the team’s programs are unknown (http://www.psychologicalscience.org/index.php/publications/observer/2013/september-13/small-nudge-big-impact.html; accessed 5 November 2013).
Such a pattern of decay is consonant with prior evidence suggesting that normative appeals have greatest impact on use in the first few days after information on the norm is received and then tend to decrease over time (e.g., Allcott and Rogers 2012; Ayres et al. 2013; Dolan and Metcalfe 2013; Ferraro and Price 2013).
Ferraro and Miranda (2013) identify ownership by merging the water data with the 2007 tax assessor database.
A rival explanation for this pattern in the data is that although movers and non-movers are observationally similar in 2007 in terms of their treatment response, the channels through which they achieve the response are completely different in unobservable ways. As noted in the text, in the absence of direct observations inside the households, our evidence is suggestive rather than definitive.
Ferraro and Miranda find that there is also an effect 2007 winter months (December 2007–March 2008), but not in the 2008 winter months (December 2008–March 2009). To calculate cost-effectiveness, we make the conservative assumption that treatment effects only exist during 2007 winter months.
According to the Cobb County-Marietta Water Authority General Manager, "25% to 33%" of a scheduled 2009 rate hike was a result of a decrease in water demand (Atlanta Journal-Constitution 7/21/08).
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Acknowledgments
The authors thank Kathy Nguyen, Herb Richardson, and Kathleen Brown of Cobb County Water System for the water data and Juan Jose Miranda for merging water utility data with tax assessor data.
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Appendix: Tip Sheet and Sample Treatment Letters
Appendix: Tip Sheet and Sample Treatment Letters
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Bernedo, M., Ferraro, P.J. & Price, M. The Persistent Impacts of Norm-Based Messaging and Their Implications for Water Conservation. J Consum Policy 37, 437–452 (2014). https://doi.org/10.1007/s10603-014-9266-0
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DOI: https://doi.org/10.1007/s10603-014-9266-0