Consumption, innovation and the environment

Behavioural and Experimental Economics for Environmental Policy


BEEP_Green hands raised

‌A project to use scientific insights from behavioural economics to improve environmental policy. The aim is to study how environmental policies targeting individuals, households and communities can be improved by accounting for people’s altruistic attitudes (desires to “do the right thing”), by co-operative and competitive tendencies (reciprocity and “keeping up with the Joneses”), and by heuristics (“rules of thumb” and mental shortcuts).

In the same way that traditional economics has proven useful for designing incentive-based environmental policies, this project investigates how behavioural economics can inform the design of “norm-based” environmental policies and “behaviourally robust” markets for ecosystem services.


GREEN TALK on Leveraging the smart grid to optimise energy consumption

In March 2018, Nicholas Rivers, Senior Economist and Professor, University of Ottawa, discussed OECD findings on the role of real-time electricity feedback in reducing consumption from the Environment Working Paper "Leveraging the Smart Grid: The Effect of Real-Time Information on Consumer Decisions".

Watch the video recording of this webinar.

Households typically cannot observe the price or the amount of electricity that they consume in real-time, so that they do not have the basis to make well-informed decisions about their electricity consumption. Can providing information help consumers to reduce their environmental footprint? The roll-out of smart electricity meters, which enable real-time feedback on electricity consumption to residential consumers, can help answer this question.


Tackling Environmental Problems with the Help of Behavioural Insights - 2017

Behavioural insights can help policy makers obtain a deeper understanding of the behavioural mechanisms contributing to environmental problems, and design and implement more effective policy interventions. This report reviews recent developments in the application of behavioural insights to encourage more sustainable consumption, investment and compliance decisions by individuals and firms. Drawing on interventions initiated by ministries and agencies responsible for environment and energy, as well as cross-government behavioural insights teams, the report portrays how behavioural sciences have been integrated into the policy-making process and shows what has proven to work – and what has not – in policy practice in OECD countries and beyond.

The report covers a variety of policy areas:

  • energy,
  • water and food consumption,
  • transport and car choice,
  • waste management and resource efficiency,
  • compliance with environmental regulation; and 
  • participation in voluntary schemes.






  • Household consumption (EPIC)


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