This recent blog post caught my eye. It claims that people who live in homes where there is a swimming pool consume 49% more electricity than those who don't. It makes the nice point that this is likely to be a selection effect rather than a treatment effect and it establishes this point by looking at the differential in average consumption between "pool homes" and homes without pools by looking off-season at spring and fall and showing that this differential persists.
So, who self-selects to live in a home with a private swimming pool? It could be a standard demographic story of households with more kids and more income gaining pleasure from having a pool and they consume more electricity.
What about environmental ideology? Are Republicans more likely to live in homes with pools? To study this, I took the data that Nils Kok and I used for our "green homes" paper and merged it by street address to Aristotle data. The Aristotle data provides information for home owners on their age and in California on their political party of registration. Using this merged data set for recent home sales in Placer County, California, I ran the following regression.
areg Pool Rep age, absorb(zip)
Linear regression, absorbing indicators Number of obs = 13145
F( 2, 13118) = 12.74
Prob > F = 0.0000
R-squared = 0.0918
Adj R-squared = 0.0900
Root MSE = .35199
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Pool | Coef. Std. Err. t P>|t| [95% Conf. Interval]
-------------+----------------------------------------------------------------
Rep | .0196991 .0061828 3.19 0.001 .0075799 .0318182
age | -.0008377 .0002082 -4.02 0.000 -.0012459 -.0004296
_cons | .1930868 .0108083 17.86 0.000 .171901 .2142727
-------------+----------------------------------------------------------------
zip | F(24, 13118) = 53.221 0.000 (25 categories)
So, for 13,145 homes in Placer County --- I ask the following question ---- within a given zip code (note the zip code fixed effects); who owns a home with a Pool? According to this linear probability model, older people are less likely to own a pool. Note the dummy variable "Rep" . This is a dummy that equals one if the head of household is a registered Republican and equals zero otherwise. All else equal, Republicans are 2 percentage points more likely to own a pool. The Pool ownership rate in this sample is 16% so this is moderate effect but it highlights that a type of ideological sorting is taking place.
What about "square footage" of the house? Again, note that I"m comparing people who live in the same zip code so this is comparing people with roughly similar incomes. The Republicans on average, live in homes that are 146 feet larger (see below) in Placer County.
areg SA_SQFT Rep age, absorb(zip)
Linear regression, absorbing indicators Number of obs = 13143
F( 2, 13116) = 54.85
Prob > F = 0.0000
R-squared = 0.1452
Adj R-squared = 0.1435
Root MSE = 909.08
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SA_SQFT | Coef. Std. Err. t P>|t| [95% Conf. Interval]
-------------+----------------------------------------------------------------
Rep | 146.5746 15.9695 9.18 0.000 115.2721 177.8772
age | -2.882094 .5377636 -5.36 0.000 -3.936189 -1.827999
_cons | 2372.058 27.91508 84.97 0.000 2317.34 2426.775
-------------+----------------------------------------------------------------
zip | F(24, 13116) = 86.957 0.000 (25 categories)
The Big House with the Pool is part of the American Dream. Does that attract you? The liberals of Berkeley are likely to say "no thanks" while some in Texas would say; "hell yeah!". When consumption offers private benefits but imposes social costs, who gorges versus who engages in voluntary restraint?
So, my point is that while standard demographics matter in explaining consumer choices that have implications for electricity consumption and co2 production. Political party identification and environmental ideology also matter. This point will be at the heart of the revised paper I present at the John Quigley Lincoln Institute Conference in October 2012.
Understanding differences in lifestyle choices between people as a function of ideology will become a more important subject at the intersection of economics, sociology and political science. Such consumption differences (do you live in a Houston McMansion?) then affect voting behavior as self interested individuals are aware of the price they will pay for a real carbon tax.
