Electricity Consumption and Durable Housing: Understanding Cohort Effects
- (pp. 88-92)
Abstract
We find that households living in California homes built in the 1960s and 1970s had high electricity consumption in 2000 relative to houses of more recent vintages because the price of electricity at the time of home construction was low. Homes built in the early 1990s had lower electricity consumption than homes of earlier vintages because the price of electricity was higher. The elasticity of the price of electricity at the time of construction was -0.22. As homes built between 1960 and 1989 become a smaller share of the housing stock, average household electricity purchases will fall.Citation
Costa, Dora L., and Matthew E. Kahn. 2011. "Electricity Consumption and Durable Housing: Understanding Cohort Effects." American Economic Review, 101 (3): 88-92. DOI: 10.1257/aer.101.3.88Additional Materials
JEL Classification
- D12 Consumer Economics: Empirical Analysis
- L94 Electric Utilities
- Q41 Energy: Demand and Supply