Does Size Matter? Empirical Evidence for Product Specification Rebound Effects
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- Master of Science 
The current study explores a new field with the concept of rebound effects that have been receiving scant attention – namely, product specification rebound effects which occur when consumers choose larger or more powerful specifications of the product as a response to improvements in energy efficiency. Although there is a theoretical foundation for their existence, almost no empirical study has previously focused on product specification rebound effects. Hence, the study aimed to empirically confirm whether efficiency improvements lead to product specification rebound effects, as well as to explore different factors that may affect their magnitude. Our findings support the existence of product specification rebound effects and show that a significant share of the anticipated energy efficiency gains can be lost due to product specification rebound effects. The study also finds that greater efficiency improvements tend to lead to greater product specification rebound effects. As energy efficiency is seen as one of the most fundamental approaches to tackle climate change, this raises a question over the effectiveness of energy efficiency measures as a way of tackling climate change. The study has significant implications for both policy makers and manufacturers, as the introduction of more energy efficient technologies results in consumers making product upgrades. From the policy making perspective, this means that expected energy gains from efficiency measures will be vastly offset by product specification rebound effects. As a result, there will not be any significant reduction in energy consumption, which is critical for tackling climate change. At the same time, from the business perspective, marketing energy efficiency seems to be a potentially successful strategy to induce product upselling. By introducing more energy efficient technologies, manufacturers can sell bigger and more powerful specifications of the product, which are usually more profitable.
Masteroppgave(MSc) in Master of Science in Business, Marketing - Handelshøyskolen BI, 2019