Supporting Carbon Pricing Markets with Probabilistic Cash Rebates

Abstract

An online incentivized experiment examines consumption and carbon-emission tradeoffs under guaranteed and probabilistic cash rebates. Guaranteed rebates reduce purchases more than 10%, 25%, and 50% rebate lotteries. The 50% rebate does not reproduce the full behavioral effect of the guaranteed rebate, but substantially reduces expected rebate expenditure while generating carbon-offset gains. The results provide a proof of concept for an effectiveness–expenditure trade-off in carbon-pricing rebate design.}

Andreas C. Drichoutis

Professor of Consumer Behavior

His research interests are focused on decision making across a broad spectrum of topics pertinent to agricultural/food economics. His contributions are notably diversified spanning the area of contingent valuation and experimental auctions methods, choice under risk, inter-temporal decision making and applied demand analysis. Most of his research applies experimental economics methods to answer questions relevant to agricultural economists and decision scientists.