Background
Pricing the use of environmental resources has proven to be a powerful tool for influencing consumer and household decisions. For example, the results of the first OECD Household Survey presented in Greening Household Behaviour: The Role of Public Policy, indicate that households charged for water consume approximately 20% less water than those who are not. In addition, households which are subject to unit pricing are more likely to install water-efficient and energy-efficient equipment at home. Similarly, fuel costs decrease car use and waste charges increase recycling volumes and encourage waste prevention.
While economic instruments are powerful tools, ?softer? instruments need to be given close attention in developing more comprehensive strategies to influence consumer and household behaviour. Access to comprehensible and trustworthy information can strengthen markets for environmentally friendly products, particularly for goods and services where environmental attributes are less ?visible?. The way in which information is presented and the way that choices are framed can influence consumer decisions. For example, eco-labels can be more effective if the environmental benefits are accompanied by more direct personal benefits for the consumer, such as a reduced energy bills resulting from energy-saving behaviour.
