Consumer Learning and Hybrid Vehicle Adoption

@article{Heutel2015ConsumerLA,
  title={Consumer Learning and Hybrid Vehicle Adoption},
  author={Garth Heutel and Erich Muehlegger},
  journal={Environmental and Resource Economics},
  year={2015},
  volume={62},
  pages={125-161}
}
We study the effect of differences in product quality on new technology diffusion. We propose a model in which heterogeneity in perceived product quality affects consumer adoption. If consumers experientially infer the quality of a technology, an increase in initial exposure to a low-quality product may inhibit subsequent diffusion. Incentives intended to speed up adoption may in fact have the opposite effect, if they propagate low-quality signals. We examine the predictions of the model using… CONTINUE READING

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