Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/29893
Authors: 
Grösche, Peter
Schmidt, Christoph M.
Vance, Colin
Year of Publication: 
2009
Series/Report no.: 
Ruhr economic papers 99
Abstract: 
Identifying the incidence of free-ridership is significant to a range of issues relevant to program evaluation, including the calculation of net program benefits and more general assessments of political acceptability. Estimates of free-ridership in the area of energy policy frequently rely on ex-post surveys that ask program participants whether they would have behaved differently in the absence of program support. The present paper proposes an ex-ante approach to the calculation of the free-rider share using revealed preference data on home renovations from Germany's residential sector. We employ a discrete-choice model to simulate the effect of grants on renovation choices, the output from which is used to assess the extent of free-ridership under a contemporary subsidy program. Aside from its simplicity, a key advantage of the approach is that it bestows policymakers with an estimate of free-ridership prior to program implementation.
Subjects: 
Energy efficiency
residential sector
random utility model
discrete choice simulation
JEL: 
C25
D12
Q4
ISBN: 
978-3-86788-110-4
Document Type: 
Working Paper

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