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MPG, fuel costs, or savings? Exploring the role of information framing in consumer valuation of fuel economy using a choice experiment

2021; Elsevier BV; Volume: 146; Linguagem: Inglês

10.1016/j.tra.2021.02.004

1879-2375

Zoe Long, Christine Kormos, Reuven Sussman, Jonn Axsen,

Climate Change Policy and Economics

Despite the large body of literature, there is still considerable debate and uncertainty about how consumers value fuel economy. This study explores how the presentation of fuel economy information can influence valuation using a stated choice experiment with comparative experimental conditions. We randomly assigned a nationally representative sample of 1,612 intended vehicle purchasers in the United States to one of six conditions, which varied in their presentation of fuel economy information as follows: miles per gallon, annual fuel costs, five-year fuel cost, lifetime fuel cost, amount of money saved/spent over five years compared to the average vehicle per class, and the full government-mandated fuel economy label (in the US). We find that consumer valuation of fuel economy is causally impacted by the information presented. In particular, we observe significantly higher willingness-to-pay values for participants in the condition with the full fuel economy label, relative to conditions only presented with the annual fuel cost, five-year fuel cost, and spend/save comparison. Valuation also varied with the demographic characteristics of participants: fuel economy was more highly valued among older participants and those that anticipated a relatively lower purchase price for their next vehicle. This study suggests that the observed inconsistencies in consumer valuation of fuel economy in the literature may stem in part from differences in the framing of fuel economy information across studies – at least for stated preference studies.