Low-Hanging Fruits: Impact of Socio-Economic and Behavioural Characteristics on Consumers’ Willingness to Pay

Norzalina Zainudin
Department of Economics and Management, Faculty of Management and Muamalah, Selangor International Islamic University College

Chamhuri Siwar
Institute for Environment and Development,
Universiti Kebangsaan Malaysia

Er Ah Choy
School of Social, Development and Environmental Studies, Faculty of Social Sciences and Humanities, Universiti Kebangsaan Malaysia

Norshamliza Chamhuri
School of Economics Studies, Faculty of Economics and Management, Universiti Kebangsaan Malaysia


Energy efficiency is generally recognized as the “low-hanging fruit in a country’s pursuit of energy security and low carbon economy. The promotion of energy efficient products at home is considered as a cost effective way in reducing energy consumption for indoor building. This research aims to examine consumer willingness to pay (WTP) in respect to energy label air-conditioner products. For this purposes, study discussed two main hypotheses which relate to socio-economic and behavioural characteristics. Result from the ordered logit model shows that income, household’s size, perceived of product advantages and perceived behaviour control negative have a significant impact on consumers’ willingness to pay. The findings of the study will contribute to the knowledge on how individual values for the environmental product innovation by making pragmatic policy recommendations that formulate strategies for addressing bottlenecks in accessing energy services by consumers. Understanding the consumers’ willingness to pay will provide invaluable insights into consumer oriented market segment with new avenues for marketers’ thought into green marketing strategy. These findings also would assist Malaysian green innovation product firms to successfully market in Malaysia.

Keywords: Socio-economics, Behavioural characteristics, Energy efficiency, Willingness to pay