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Long-Term, Heterogeneous Treatment Long-Term, Heterogeneous Treatment
Effects from Non-Pecuniary Environmental Effects from Non-Pecuniary Environmental
Programs: A Large-Scale Field ExperimentPrograms: A Large-Scale Field Experiment
Paul J. FerraroPaul J. Ferraro
Department of EconomicsDepartment of Economics
Georgia State UniversityGeorgia State University
Juan Jose MirandaJuan Jose Miranda
Department of EconomicsDepartment of Economics
Georgia State UniversityGeorgia State University
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Information CampaignsInformation Campaigns
(1) Info on behavioral and technological
modifications
(2) Request users to voluntarily change
their behavior for the public good
(3) Provide social comparisons to induce
individuals to conform to a social
norm.
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Field ExperimentField Experiment
• Water system in Metro Atlanta: with
Ferraro, implemented targeted,
residential information campaign as
randomized experiment.
• Three treatments sent via first class
mail in May 2007.
• Ferraro and Price focus on short-term,
mean treatment effects in summer 2007.
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Ferraro and MirandaFerraro and Miranda
Longer-term impacts (2008, 2009).
Heterogeneous Treatment Effects
• Relevant for policy and practice
• Relevant for understanding
mechanisms
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Treatment 1: Tip SheetTreatment 1: Tip Sheet
Information on behavioral
changes and technologies that
can reduce water consumption
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Treatment 2: Weak Social Norms Treatment 2: Weak Social Norms (standard message)(standard message)
Tip sheet+ Civic Duty Language
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Treatment 3: Strong Social NormsTreatment 3: Strong Social Norms
Tip sheet+ Letter with “Civic
Duty” Language + Social
Comparison
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Social ComparisonSocial Comparison
Your own total consumption June to October 2006: 52,000 gallons Your neighbors’ average (median) consumption June to October 2006:35,000 gallons You consumed more water than 73% of your Cobb County neighbors.
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Reduction in Summer ’07 Consumption
{95% CI}
Number of Homes
Control -- 71,643
Treat 1 (Tip) - 0.7%{-1.7%, 0.4%}
11,675
Treat 2 (Weak Norms)
- 2.7%{-3.7%, -1.8%}
11,675
Treat 3 (Strong Norms)
- 4.8%{-5.7%, -3.9%}
11,676
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Summer 2008
Summer 2009
Treat 1 (Tip) ~0% ~0%
Treat 2 (Weak Norms)
~0% ~0%
Treat 3 (Strong Norms)
-2.5%(p<0.01)
-1.3%(p<0.05)
Persistence of Treatment EffectsPersistence of Treatment Effects
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Heterogeneous Treatment EffectHeterogeneous Treatment Effect
Nonparametric Tests (Crump et al.
2008)
Test Null of Zero Conditional Average
Treatment EffectsCannot reject that Treatment 1 effect is
zero for all subgroups.
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Heterogeneous Treatment EffectHeterogeneous Treatment Effect
Nonparametric Tests (Crump et al. 2008)
Test Null of Constant Conditional Average
Treatment Effects
Reject null that Treat 2 (p<0.10) and Treat 3 (p<0.01) have constant treatment effects
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Treatment 1
(tips)
Treatment 2
(weak norm)
Treatment 3 (strong norm)
-4.0
0-3
.00
-2.0
0-1
.00
0.0
01.0
02.0
0T
reatm
ent 1
0 .2 .4 .6 .8 1Quantile
-4.0
0-3
.00
-2.0
0-1
.00
0.0
01.0
02.0
0T
reatm
ent 2
0 .2 .4 .6 .8 1Quantile
-4.0
0-3
.00
-2.0
0-1
.00
0.0
01.0
02.0
0T
reatm
ent 3
0 .2 .4 .6 .8 1Quantile
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Subgroup AnalysisSubgroup Analysis
Household
Wealth (market value of house),
age of home, ownership
Neighborhood
characteristics Education,
race, ownership
Treatment 3 (2007) by SubgroupsTreatment 3 (2007) by Subgroups
More responsive: wealthy More responsive: wealthy
households, owners and households households, owners and households
in neighborhoods with more white and in neighborhoods with more white and
educated householders and fewer educated householders and fewer
renters.renters.
No difference conditional on year in No difference conditional on year in
which home was built.which home was built.16
Nonpecuniary vs PecuniaryNonpecuniary vs Pecuniary
Strong social norm message:Strong social norm message: 2007 effect equivalent to average 2007 effect equivalent to average
price increase of ~12-15%.price increase of ~12-15%. Immediately detectable one month Immediately detectable one month
later.later. High-income households High-income households
Most responsive to normsMost responsive to norms Least responsive to price (Mansur & Least responsive to price (Mansur &
Olmstead 2007)Olmstead 2007) Effect declines over time.Effect declines over time.
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MechanismsMechanisms Evidence consistent with behavioral Evidence consistent with behavioral
changes with recurring costs rather than changes with recurring costs rather than one-time fixed-cost investments. Mostly one-time fixed-cost investments. Mostly from outdoor use.from outdoor use.
Evidence consistent with interpretation Evidence consistent with interpretation that social comparison operates through that social comparison operates through social norms rather than private social norms rather than private efficiency signals to a boundedly rational efficiency signals to a boundedly rational agent.agent.
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Choosing Among Non-Choosing Among Non-experimental Estimatorsexperimental Estimators
“Design-replication study”
Form a non-experimental comparison group from households in neighboring counties. Then use “best-practice” econometric methods (regression, matching, panel data, regression discontinuity) to estimate treatment effect. Contrast non-experimental estimates to experimental estimates.