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Risk aversion and cleaner cooking fuel choice: an empirical study in Ghana

Published online by Cambridge University Press:  08 August 2022

Kwame Adjei-Mantey  and
Kenji Takeuchi Open the ORCID record for Kenji Takeuchi [Opens in a new window]
Kwame Adjei-Mantey
Affiliation:
Graduate School of Economics, Kobe University, Kobe, Japan Department of Sustainable Energy and Resources, University of Environment and Sustainable Development, Somanya, Ghana
Kenji Takeuchi*
Affiliation:
Graduate School of Economics, Kobe University, Kobe, Japan
*
*Corresponding author. E-mail: [email protected]
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Abstract

Cleaner cooking is an important policy objective in the bid to achieve sustainable development. Despite efforts to encourage cleaner cooking fuel use, biomass fuel is still widely used in many developing countries. This study investigates the role of behavioral factors, particularly risk aversion, in the choice of cooking fuels in Ghana. In addition, we investigate how the improvement of supply infrastructure and services mitigates the impact of risk preferences in fuel choices. By employing data from the recent round of the Ghana Living Standards Survey, we find that risk-averse households are less likely to choose liquified petroleum gas as their cooking fuel. However, the effect is mitigated for households located in districts with more supply infrastructure. Additional analyses reveal the influence of risk and time preferences in other household behavior.

Keywords

cleaner cookingGhanaLPGrefill stationrisk aversion

JEL classification

O12: Microeconomic Analyses of Economic Development Q56: Environment and Development • Environment and Trade • Sustainability • Environmental Accounts and Accounting • Environmental Equity • Population Growth D81: Criteria for Decision-Making under Risk and Uncertainty Q20: General Q41: Demand and Supply • Prices
Type
Research Article
Information
Environment and Development Economics , Volume 28 , Issue 2 , April 2023 , pp. 130 - 148
Copyright
Copyright © The Author(s), 2022. Published by Cambridge University Press

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