• Corpus ID: 43197863

The Lightbulb Paradox : Using Behavioral Economics for Policy Evaluation

  title={The Lightbulb Paradox : Using Behavioral Economics for Policy Evaluation},
  author={Hunt Allcott and Dmitry Taubinsky},
In an e¤ort to reduce energy use, governments in the United States and many other countries subsidize energy e¢ cient lightbulbs or ban traditional incandescent bulbs. We evaluate one important rationale for these policies: that imperfect information or attentional biases cause consumers to purchase more incandescents than they would in their private optima. We formalize a model of consumer choice that allows for such biases and develop formulas that allow optimal policy to be approximated… 

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