ABSTRACT: Liberalised retail energy markets present an apparent puzzle: when offered the chance to buy a homogeneous product at a lower price, many consumers appear to leave ‘money on the table’. We observe the decisions made by over 7,000 consumers in a collective switching exercise and find that seemingly suboptimal consumer behaviour may be understood better if a sufficiently rich range of non-monetary ‘switching costs’ are identified. We discuss some policy implications for the expectations of consumer response in designing and regulating markets.
CITATION: Deller, D., Giulietti, M., Loomes, G., Waddams Price, C., Moniche Bermejo, A., & Jeon, JY. (2017) "Switching Energy Suppliers: It's not all about the money", CCP Working Paper 17-5
Policy Brief 17-5 (available soon)