Behavioral Economics and the Solar PV Industry

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Behavioral economic theory holds that human interactions are complex and that economic motivations include nuance beyond that of maximizing utility. This is certainly true of the global solar industry as throughout its history it has interacted within a context of here-one-day-gone-the-next incentives and subsidies, expectations of significant price drops, competition with well-subsidized conventional energy technologies as well as a continuing perception among many that solar remains a science experiment.

Solar industry participants have a preference for very big numbers and forecasts as well as for optimistic outlooks for the future.  Any deviation from the celebration of really big numbers or any notion that strays from the optimistic status quo is typically ignored. 

Cherry-picking facts — be they optimistic or pessimistic — to make a point without considering context and nuance, will almost always lead to poor decision-making. 


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