Research

We conduct a randomized experiment embedded within an online survey of Indian households to understand their intention to conserve water using two types of interventions: behavioral nudges (a “collective identity” prime and a social norm message) and a price rebate for water-saving investments. We find that rebates are more effective for costlier conservation actions like purchasing an individual water meter, while nudges are more likely to influence less costly investments such as a plumbing inspection and daily habit-based changes in water use. Our results also point towards the complementary nature of priming and social norm nudging. Overall, our findings lend support to the value of strategically targeting behavioral and monetary water conservation measures, especially in resource-constrained, urban residential settings.

Rainfall shocks are a growing concern as climate change increases exposure for households in developing economies, where consumption and food security are often at risk. This paper studies whether and how households’ holdings of liquid and illiquid assets, along with debt, moderate consumption responses to these shocks. In particular, we examine whether the moderating role of a household’s financial composition varies by region (rural vs. semi-urban) and by consumption type (food vs. nonfood). Using panel data on households in Thailand from 1999 to 2012, we find that liquid assets help buffer food consumption, particularly for households in the semiurban region, where greater cash holdings mitigate the adverse impact of shocks. In the rural region, deposits play a positive moderating role in smoothing food consumption. In contrast, illiquid assets generally do not buffer food consumption and are in some cases associated with larger declines. Higher borrowing also negatively moderates both food and nonfood consumption for rural households. Our findings suggest that improving access to liquidity might improve households’ ability to smooth consumption during adverse rainfall shocks.

Water utilities across the United States are seeking pricing structures that promote conservation while maintaining revenue stability. This paper evaluates a water pricing reform in Lawrence, Kansas, a mid-sized Midwest city, that transitioned from a uniform-volumetric price to an inclining block rate (IBR) in April 2021. Using monthly billing data from 14,279 households (2018-2023), we employ a Difference-in-Differences framework to estimate the policy’s impact on residential water use. We find that households with higher pre-policy consumption reduced water use. Price elasticity estimates suggest that the IBR shifted household decision-making from average toward marginal prices. We also document geographic heterogeneity in response and city revenue increases. Our findings offer important policy insights on how IBRs can promote conservation even in non-arid regions and target discretionary water use effectively, offering a viable template for other municipalities aiming to enhance water sustainability.

In today’s United States, the dependence on electricity in people’s daily lives makes it imperative to “keep the lights on”. However, with the increasing frequency and intensity of extreme weather events induced by climate change, sustained power outages are becoming more common. The goal of this paper is to evaluate the resilience of electric utilities to severe weather events, as indicated by the length of the average restoration time, conditional on a power outage occurring. Using a quadratic two-way fixed effects panel data model with annual utility-level Customer Average Interruption Duration Index data and county-level (aggregated to state-level) Federal Emergency Management Agency disaster declarations data, preliminary results indicate about a 40-minute increase in the average restoration time by a utility due to weather-related disasters in a state during an average year. This, at the mean of such events, implies a 19-minute increase in restoration time with each additional severe event. Moreover, the marginal increase of an additional severe weather event is significant up till the seventh event. Stratifying the sample by utility ownership suggests that investor-owned utilities (IOUs) and electric cooperatives drive these results. Plausible explanations are the cost build-ups due to lack of federal pre- and post- disaster funding opportunities to IOUs, and the rural infrastructure and limited resources for grid resilience for electric cooperatives

The US government has set a nationwide target for 100% clean electricity by 2035 and reliable hydropower is key to achieving that goal, especially in the Pacific Northwest (PNW). However, droughts are a threat and increasing in intensity and frequency due to climate change. In this paper, I estimate the causal impact of high-intensity droughts between 2012-2021 on hydroelectricity generation in the PNW. Using 10 years of plant-level data and county-level measures of drought that are more comprehensive than those widely used in the literature, I find a 23% decrease in generation of an average hydropower plant if an entire county is hit by such droughts. This result, showing the vulnerability of this region’s most abundant clean energy source to high-intensity droughts is robust across a range of specifications and drought definitions, including an alternative unit of analysis at the plant-catchment area-month level. Further, a back-of-the-envelope calculation suggests substantial additional social costs of increased carbon emissions generated from the replacement of the lost hydropower by fossil fuels. Disaggregating the overall effect to examine heterogeneous impacts indicates that high-intensity droughts negatively impact large capacity plants, run-of-river operations, and summer generation more severely. Comparing two major drought events, 2015 and 2021, suggests that the severity of impact also varies by drought prevalence. My findings carry important implications for electricity suppliers in the region and policymakers thinking about future hydropower development in light of the 100% goal.