Does financial compensation increase the acceptance of power lines? Evidence from Germany
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Date
2017
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Abstract
Although public support for renewable energy promotion in Germany is
strong, the required power line construction has incited a groundswell of opposition
from residents concerned about the impacts on their neighborhoods. This paper
evaluates a large randomized one-shot binary-choice experiment to examine the
effect of different compensation schemes on the acceptance of new power line construction.
Results reveal that community compensations have no bearing on the acceptance
level, whereas personal compensations have a negative effect. Two possible
channels through which financial compensation reduces the willingness-to-accept are
(1) crowding out of intrinsic motivation to support the construction project and (2) a
signaling effect that alerts residents to potential negative impacts of the power lines.
Both explanations call into question the efficacy of financial payments to decrease local
opposition.
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Keywords
not-in-my-backyard, randomized discrete choice experiment, motivation crowding out, willingness to accept