{"id":85988,"date":"2026-05-07T17:00:56","date_gmt":"2026-05-07T16:00:56","guid":{"rendered":"https:\/\/www.lse.ac.uk\/granthaminstitute\/?post_type=event&p=85988"},"modified":"2026-05-07T17:01:57","modified_gmt":"2026-05-07T16:01:57","slug":"projection-bias-in-durable-goods-investment-evidence-from-solar-panel-adoption-in-norway-massimo-filippini","status":"publish","type":"event","link":"https:\/\/www.lse.ac.uk\/granthaminstitute\/events\/projection-bias-in-durable-goods-investment-evidence-from-solar-panel-adoption-in-norway-massimo-filippini\/","title":{"rendered":"Projection bias in durable goods investment: evidence from solar panel adoption in Norway | Massimo Filippini"},"content":{"rendered":"\n

Massimo Filippini will present the paper ‘Projection Bias in Durable Goods Investment: Evidence from Solar Panel Adoption in Norway’ by Massimo Filippini and Cloe Garnache.<\/p>\n\n\n\n

Abstract<\/strong><\/p>\n\n\n\n

We study household investment responses to a large electricity price shock in the context of rooftop solar adoption in Norway. Exploiting regional price divergence during the 2022-2023 energy crisis, we use difference-in-differences and spatial regression discontinuity designs to estimate causal effects on solar investment. Treated municipalities experienced almost 500% increases in solar capacity and over 300% increases in installations relative to control regions, despite solar panels generating low returns due to Norway’s limited winter sunlight when electricity demand peaks. We estimate the degree of projection bias underlying this response using a good-of-fit approach. Results suggest that households place around 64% to 65% weight on current prices when evaluating long-run profitability, as identified by maximising the log-likelihood of the adoption model over the projection bias parameter. During the 2022–2023 price shock, projection bias led households to overestimate the NPV of a representative solar system by approximately e1,180e 1,200 per installation relative to the rational expectations benchmark. Through the NPV channel, projection bias accounts for approximately 30% of the total treatment effect on installations and 3 6% on capacity, corresponding to roughly 2,200 excess installations and 42,000 excess kW across the treated region annually during the shock period. Our findings demonstrate that behavioural biases can dominate rational investment criteria during crisis periods, with implications for microeconomic theory, household finance, technology adoption, and the transmission of macroeconomic shocks.<\/p>\n\n\n\n

\n\n\n\n

Grantham Workshops are only open to LSE researchers and alumni. If you wish to attend the workshop in person or online please sign up to our workshop mailing list<\/a><\/strong>.<\/a><\/p>\n\n","protected":false},"excerpt":{"rendered":"\n

Massimo Filippini will present the paper ‘Projection Bias in Durable Goods Investment: Evidence from Solar Panel Adoption in Norway’ by…<\/p>\n\n","protected":false},"author":12,"featured_media":0,"template":"","tags":[410,2263,1162,933,4171],"event-type":[37],"topic_area":[4697,4698],"class_list":["post-85988","event","type-event","status-publish","hentry","tag-electricity-prices","tag-energy-crisis","tag-household-energy","tag-norway","tag-solar-panels","event-type-grantham-workshop","topic_area-energy","topic_area-behavioural-responses"],"acf":{"exclude_from_sync":{"ref_value":"field_560538b0e7350","value":"0","type":false,"post_type":""},"start_date":{"ref_value":"field_52f56b18a98ba","value":"20260520","type":false,"post_type":""},"start_time":{"ref_value":"field_52f56b33a98bb","value":"13:00:00","type":false,"post_type":""},"end_date":{"ref_value":"field_52f56bb58f239","value":"20260520","type":false,"post_type":""},"end_time":{"ref_value":"field_52f56bd38f23a","value":"14:30:00","type":false,"post_type":""},"event_venue":{"ref_value":"field_531c65c575d35","value":"FAW 9.04, London School of Economics, Clement\u2019s Inn, London WC2A 2AZ","type":false,"post_type":""},"location":{"ref_value":"field_559cf9dc612b6","value":"","type":false,"post_type":""},"external_speaker":{"ref_value":"field_5374dcb208782","value":"","type":false,"post_type":""},"eventbrite_link":{"ref_value":"field_52f59e0b20728","value":"","type":false,"post_type":""},"rss_newsletter":{"ref_value":"field_54f5c2c1544d8","value":"","type":false,"post_type":""},"profile_link":{"ref_value":"field_52f164b5189e9","value":["projection-bias-in-durable-goods-investment-evidence-from-solar-panel-adoption-in-norway-massimo-filippini"],"type":"relationship","post_type":""},"spotlight":{"ref_value":"field_52f80896506d3","value":"","type":false,"post_type":""}},"yoast_head":"\nProjection bias in durable goods investment: evidence from solar panel adoption in Norway | Massimo Filippini - 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