"Conspicuous Conservation" and the Prius Effect

The height of conspicuous conservation? (Photo: Toyota)

This month, Toyota sold its one millionth Prius hybrid in the U.S. In 10 years, this strange-looking vehicle with the revolutionary engine has claimed a spot among the best-selling cars. Pretty impressive. But are all those Prius owners thinking mainly about better mileage and a smaller carbon footprint, or is there another incentive at work? More broadly: when people make environmentally sound choices, how much are those choices driven by the consumers’ desire to show off their green bona fides?

Two young economists, Steve and Alison Sexton, have been looking into this question. (Not only are the Sextons twins, but their parents are also economists, and Steve is a competitive triathlete.) The result is an interesting draft paper called “Conspicuous Conservation: The Prius Effect and WTP [Willingness to Pay] for Environmental Bona Fides.” When you drive a Prius, the Sextons argue, there’s a “green halo” around you. You make new friends; you get new business opportunities. In an especially “green” place like Boulder, Colo., the effect could be worth as much as $7,000.

The Sextons focused on the distinctive design of the Prius — which was no accident. Honda, Ford, Nissan and other car makers sell hybrids, but you can’t pick them out on the road (the Civic hybrid, for instance, looks just like a Civic). The Prius is unmistakable. It marks whoever is driving it as someone who cares about the environment; it’s an act of “conspicuous conservation,” an update of Thorstein Veblen’s “conspicuous consumption.” Here’s how Steve Sexton describes it:

SEXTON: A sort of “keeping up with the Joneses”-type concept but applied to efforts to make society better. I will be competing with my neighbors to donate to a charity, for instance, or to reduce energy conservation or environmental impacts.

On Marketplace, just in time for Earth Day, Stephen Dubner talks to Kai Ryssdal about this and other forms of conspicuous conservation.

Here’s where to find Marketplace on a radio station near you.


VJBinCT

My wife has had a Prius for about 5 years now, and loves it. The virtuousness does show, but I like it too, for a number of practical reasons. Certainly the mileage is great, though not mind-boggling i ncomparison to some other economy models. It also has some neat features that give it curiosity cachet.. But what I like most is the huge volume efficiency of the thing. We often travel to our kids' houses 300-1000 miles away with huge amounts of STUFF. We fit 10 foot long lumber into it, honest to God! The newest models are supposed to be even bigger inside without much increase on the outside. Extremely well-designed vehicle. I myself wouldn't care if it were a diesel-powered car with almost the same mileage as a hybrid. It just works well as a people and goods mover.

Vania

I thought the Prius wasn't that good a choice actually, given its embedded energy, and small components travelling all over the world to make its way into the car... greenest option is to drive an old car until it can't go any longer, even if the consumption is higher than a Prius, since most of the energy over a lifetime is used in the manufacture... I wish the myth of the Prius would be debunked!

Bill

I wonder how these economists will tease out the relevant data. We own a Honda Insight - the Prius actually looks a lot like the original Honda Insight on the market years before the Prius. We see a number of Prius (Prii?) on the road, but few Insights - less money and more bang for the buck than the slightly larger Prius. Friends who own a Prius talk about gas mileage, as we do, and not their environmental concerns in the context of their car ownership.

Politburo

The whole analysis seems to hinge on the assumption that all hybrid vehicles are equal. This is far from the case. There is a reason that the Prius is the best-selling hybrid, and it's not because the design is distinctive or because of 'street cred'. It's because it gets the 2nd best mileage and sacrifices pretty much nothing from what we expect in a "normal" car. The Insight might get better mileage, but sacrifices a lot (the authors hand-waved away this huge counterexample in a footnote).

All the other hybrids are weak tea since they were not purposefully designed as a hybrid vehicle and only get marginal MPG improvements that do not offset the increased purchase price.

Debbi Evans

Great post, thanks!

There's another paper from the Uni of Minnesota very much along the same lines - you may also find it useful/interesting...http://www.csom.umn.edu/assets/140554.pdf

"Going green to be seen: status, reputation and conspicuous consumption"

Debbi
canvas8.com

Joseph Steig

What drives me a bit batty--as a self-professed car guy--is that no one comments on what an utterly brilliant design the Prius is completely aside from the fact that it's a hybrid. The thing has better space utilization than any car on the road today in the United States. Even without being a hybrid, it deserves to be a best seller because it's so large on the inside for its relatively small outside. Additionally, there IS NO PRIUS PRICE PREMIUM. I simply can't understand how people can calculate that. It's about the same price as a Camry or Accord, but has more space inside. and gets better mileage. With this study saying you get added green halo effects, it's even more of a bargain. And no, I don't own one...yet.

mark o

i have a client who is obsessed with his hi-profile energy conservation mode.
he's addicted to the local press and his image.
and...he won't insulate one of his buildings that is leaking energy like a sieve.
insulating a bldg will never bring sweet press.
sad but true.

Logan

There are people who purchase a Prius for “conspicuous conservation” but, the researchers data is flawed if they choose a Honda Civic Hybrid as a control (or any other car for that matter). I believe it is reasonable to assume the average person in the market of a hybrid vehicle is interested in the following attributes: cost to own, performance, and environmental effects.
Cost to own - The researchers were correct in that the purchase cost of the vehicles are very similar. However, the Prius gets an additional 6mpg over the civic. This is a significant and will save the owner 2200 dollars over the life of the car.
Environmental Effects - Again, the 6 mpg advantage is significant.
Performance - The Prius handles well and despite popular belief, has more than enough power to drive efficiently and safely. I will assume the Civic is also capable in this manner. However, there is a feature more fundamental to automobile performance than acceleration, the ability to transport stuff from point A to point B. The prius literally has more than twice the cargo space of the civic hybrid. That is a remarkle advantage. I think we can safely assume that there is a correlation between hybrid ownership and passion for outdoor activities. Outdoor activities often require great amounts of gear and thus, we should assume the additional cargo space of a Prius is a very desirable quality among hybrid owners.

I think this topic of economics is intriguing and worth researching but, the quality of the research discussed in this podcast was disappointing.

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trol

i drag race im my hibrid

liam

The problem with Steve and Alison's study is that they ignore the fact that people like to show that the conservation movement has momentum. They may be more confident about making the effort to show that they are part of the movement when the movement is bigger. They also ignored a big alternate hypothesis: that people in anti-environmental regions may be afraid to exhibit obvious environmentalist tendencies. I grew up in Idaho, where one may feel nervous admitting that they were environmentalists, road a bike, drove an efficient car. Guys in some bars look at you sideways if drove up in something other than a truck.

I commute by bike, and I am convinced that people are more likely to ride if they see that I can ride to work with out difficulty.

On the point about solar panels, efficiency is not just about sun, it is also about not overheating solar panels. This helps with efficiency in SF and Seattle.

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Zurdo

Good article, they didi not provide the financial analysis:

20,000 miles per year at 20 mpg in previous car = 1000 gallons
20,000 miles per year at 50 mpg in 20102 Prius =400 gallons
Annual savings 600 gallons times $4 per gallon= $2400 per year

In addition to being Conspicuous Conservation it has a great pay back
10 years the car is free

Scott

The Prius gets 51 mpg, while the comparison car, the Honda Civic Hybrid gets 41mpg. This is a 20% difference, more than enough to explain the difference in popularity. Also, the Prius' design allows it to get better mpg due to aerodynamics.

I was disappointed that these issues were not addressed in this report.

tom murphy

Don't forget the lower weight of the Prius-the ultimate gas saver. I don't remember owning so light a car since the 1960's!

Brad

In comparing the Prius to the Civic Hybrid as "essentially the same" I think the authors actually based many of their discussion points on an inaccurate assumption. I owned a standard Civic for years and loved the car. When it was time for new car, I tried very hard to convince myself to buy the Civic hybrid, but couldn't get around the difference in mileage the Prius offered. My Prius consistently gets me just above 50 mpg, while the Civic hybrid, according to fueleconomy.gov gets scarcely over 40 mpg. Which is really just 5 mpg more than I was getting with my standard engine Civic. The Prius offers a 20% improvement in gas mileage over the Civic. This is not a fair comparison. I would have rather stuck with the stylings of my beloved Civic, but the mileage of the Prius won over.

Ferhan

I was intrigued by this topic and did some calculations on my own. You can see them here.

http://www.livexperimental.com/2012/08/hybrid-car-multi-thousand-dollar-feel.html

There is no financial benefit to the purchaser while buying a hybrid. There is no clear and measurable environmental benefit either, since production seems to be costly and causes other indirect environmental impact. So the only thing left is the "look rich and environmental" angle.

Billy

OK, accepted that there may be some "Prius Effect" that puts some small green halo around purchasers. If I gave this a great deal of thought, I'd probably come up with a huge SO WHAT? in response. EVERY friggin' thing ANYBODY purchases says something about the purchaser, if we do enough naval gazing. There are good, practical reasons to buy a high MPG car. Are there more subtle reasons? Yeah, but there are subtle reasons for buying a black car or a red car instead of a white one. Who the hell cares? And buying a Prius says waaaaay less about Prius owners than the morons who customize their trucks with "Prius repellant" or "Rollin' Coal". THOSE people are serious head cases....