Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/333496 
Year of Publication: 
2025
Series/Report no.: 
Economics Working Paper Series No. 25/400
Publisher: 
ETH Zurich, CER-ETH - Center of Economic Research, Zurich
Abstract: 
Minimum standard regulations for durables have long been suspected of having hidden costs: quality improvements in the regulated dimension reduce quality in other dimensions. We substantiate this claim for the U.S. clothes washer market, which has become a notorious example of the hidden cost phenomenon due to a 2004 energy efficiency requirement. We find that overall quality increased from 2001 to 2011, and these gains were primarily driven by improvements in energy efficiency. Quality in the non-energy dimensions declined or remained constant after the major standard change. These hidden costs were, however, compensated by energy-efficiency improvements.
Subjects: 
Minimum Quality Standard
Hidden Cost
Energy Efficiency Regulations
Appliance Market
Ex Post Analysis
JEL: 
Q48
Q55
L51
L68
D12
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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