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Sustainable Lifestyles: Microeconomic and Macroeconomic Models www.glamurs.eu 1 A New Paradigm • Integrate important theories from psychology into economics • go beyond behavioural economics • formalise theories • View environmental policy from consumers’ perspectives www.glamurs.eu 2 Structure 1. Individual behaviour 2. Population behaviour 3. Behaviours and networks 4. Environmental policy www.glamurs.eu 3 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 www.glamurs.eu 4 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 www.glamurs.eu 5 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). www.glamurs.eu 6 Population behaviour • social interaction • dynamics • evolutionary game theory • utility as fitness • imitation • learning by doing • technical, societal and environmental tipping points • path dependence www.glamurs.eu 7 Behaviour and Networks • spatial network • social network • local effects in network • aggregate effects in networks • uptake of green lifestyles • diffusion of green lifestyle, spillovers www.glamurs.eu 8 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 www.glamurs.eu 9 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? www.glamurs.eu 10