Template-Type: ReDIF-Paper 1.0
Title: The impact of price comparison tools on electricity retailer choices
Author-Name: Peter Gibbard
Author-Email: peter.gibbard@otago.ac.nz
Author-Name: Kevin Remmy
Author-Email: remmy@uni-mannheim.de
Classification-JEL: D12, D83, L13, L94
Keywords: consumer inertia, consumer search, retail electricity markets, structural demand estimation

Abstract: We estimate a structural model of electricity retailer choices accommodating various
sources of consumer inertia, including inattention, limited information, switching costs,
and product differentiation. The model disentangles the relative importance of different
frictions. We estimate our model using individual-level data of all retailer switches and
queries on a price comparison website in New Zealand. We find that price comparison tools
strongly impact market structure and consumer surplus. However, mandating all consumers
search for alternatives has stronger effects on market structure and consumer surplus gains.
Our results help policymakers design policies that improve consumer choices and effective
competition in retail markets.

Note: 
Length: 41
Creation-Date: 2024-03
Revision-Date:
File-URL: https://www.crctr224.de/research/discussion-papers/archive/dp516
File-Format: application/pdf
Handle: RePEc:bon:boncrc:CRCTR224_2024_516