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Research Paper Cambridge Real Estate Research Centre Working Paper Series 2016-08

Personality traits and energy efficiency in the UK residential market


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The limitations of simple payback and investment profitability models for energy efficiency investments are well established in the literature. This paper investigates whether personality traits play a significant role in the decision-making process of investing in energy efficiency in the residential sector. Using the Understanding Society UK survey data, we apply structural equation modelling to examine if personality traits may explain why certain individuals choose to invest in energy efficiency measures while others do not, even under almost identical financial
conditions. The results show that the link between personality traits and energy efficiency measures are primarily mediated trough risk preferences and/or attitudes toward the environment. Similar mediation effects are found for pro-environmental habits. However, an important difference is that households with higher incomes have a higher propensity to invest in energy efficiency while the opposite is the case for other pro-environmental behaviours and habits. The findings of this analysis underline the need for differentiated and targeted products and policies in the market for residential energy efficiency.


Environmental Sociology, Psychology, Households, Housing Market, and Sociology Of Households


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