Sustainable Lifestyles:
Microeconomic and
Macroeconomic Models
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A New Paradigm
• Integrate important theories from
psychology into economics
• go beyond behavioural economics
• formalise theories
• View environmental policy from
consumers’ perspectives
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Structure
1. Individual behaviour
2. Population behaviour
3. Behaviours and networks
4. Environmental policy
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Individual behaviour: 1
• Maximize utility!
preferences, consumption, activities (goods, energy, waste,
transportation, time allocation)
• Constraints: income, technology, infrastructure, time
• Driving factors: dispositional (internal) and situational (external)
factors
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Individual behaviour: 2
1.
2.
3.
4.
5.
6.
7.
8.
reference point
social norms
environmental concern and altruism
self-identity, social identity & status,
cognition (habits, reference group bias and self-serving bias)
personal norms, values, attitudes
beliefs/expectations
discounting
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Individual behaviour: 3
Conflicts Among the Determinants of Environmental Behavior?
1. Habits dominate attitudes (short-distance car travel).
2. Income and price dominate technological progress
(rebound-effect).
3. Infrastructure dominates attitudes (no public transport).
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Population behaviour
• social interaction
• dynamics
• evolutionary game theory
• utility as fitness
• imitation
• learning by doing
• technical, societal and environmental tipping points
• path dependence
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Behaviour and Networks
• spatial network
• social network
• local effects in network
• aggregate effects in networks
• uptake of green lifestyles
• diffusion of green lifestyle, spillovers
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Environmental Policy
• monetary interventions, like taxes and subsidies
• environmental policy that lower infrastructural barriers to
the adoption of innovative sustainable products
•
information and education campaigns that move
consumers decisions towards sustainable choices
• nudging, non-monetary interventions aimed at changing the
decision frame towards sustainable choices
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Questions
1. How important do you think are social norms
compared to monetary incentives when it comes to
the emergence of sustainable life-style?
2. Do you think that people understand the difference
between environmental significant and insignificant
behaviour? Are they aware of their environmental
impact?
3. Which key factors/phenomena do you believe will
influence the diffusion and adoption of sustainable
life-styles?
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