Using stated preference methods to design cost-effective subsidy programs to induce technology adoption: An application to a stove program in southern Chile
We study the design of an economic incentive based program – a subsidy – to induce adoption of more efficient technology in a pollution reduction program in southern Chile. Stated preferences methods, contingent valuation (CV), and choice experiment (CE) are used to estimate the probability of adoption and the willingness to share the cost of a new technology by a household. The cost-effectiveness property of different subsidy schemes is explored numerically for different regulatory objectives.