The role of environmental and financial motivations in the adoption of energy-saving technologies: Evidence from European Union data

Abstract

Copyright © 2023 The Author(s). This paper investigates whether households’ environmental and financial motivations affect their investments in energy-saving technologies. Exploiting a comprehensive dataset covering 30 European countries, we investigate whether financially motivated and environmentally minded households present different adoption paths. The results show that environmental and financial motivations play an essential role in the decision to adopt energy-saving technologies, thus paving the way for policy actions targeted at enhancing consumer awareness. Our analysis also reveals that environmentally and financially motivated households exhibit different socio-economic profiles. We find that environmentally minded, highly educated households living in urban areas with a large family size are more likely to adopt energy-saving technologies than their counterparts with low levels of education living in rural locations. In addition, their financial situation is an important factor in explaining the adoption patterns of financially motivated households. From a methodological point of view, our analysis exploits both parametric and nonparametric methods. We use stochastic dominance analysis to rank the distribution functions of household behaviours and the logit model to investigate the socio-economic profiles of different groups.