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Article
2026
Subsidy free-riding is positively correlated to the development of energy efficiency in the housing stock
Subsidy free-riding is positively correlated to the development of energy efficiency in the housing stock
Abstract (English)
Incentivizing energy-efficient retrofits in residential sectors often involves subsidies, which are aimed at lowering a building’s environmental impact. However, the effectiveness of these subsidies has been debated, particularly concerning an unintended consequence known as free-riding. Free-riders are investors who would have made energy-efficient retrofits even without the subsidy. Typically, a high prevalence of free-riding is perceived negatively from an economic perspective in terms of the impact and efficiency of a policy. However, apart from economic efficiency, it is unclear what the relation between free-riding and the progression of the buildings’ energy standards is. We employed an agent-based model to mimic a neighborhood and discovered an intriguing pattern: Areas with more free-riders actually showed advanced energy standards in their building infrastructure now and 7 years into the future. These insights enhance our comprehension of free-riding and can help policymakers take this relation into account when designing subsidy schemes.
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Environment, development and sustainability, 28 (2026), 3, 7701-7717.
https://doi.org/10.1007/s10668-024-05292-z.
ISSN: 1573-2975
Dordrecht : Springer Netherlands
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Neef, N. E., Egner, L. E., & Klöckner, C. A. (2026). Subsidy free-riding is positively correlated to the development of energy efficiency in the housing stock. Environment, development and sustainability, 28(3). https://doi.org/10.1007/s10668-024-05292-z
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English
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330 Economics
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University bibliography
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Sustainable Development Goals
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@article{Neef2026,
doi = {10.1007/s10668-024-05292-z},
author = {Neef, Nicolas E. and Egner, Lars E. and Klöckner, Christian A. et al.},
title = {Subsidy free-riding is positively correlated to the development of energy efficiency in the housing stock},
journal = {Environment, development and sustainability},
year = {2024},
volume = {28},
number = {3},
pages = {7701--7717},
}