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Startup Costs and the Decision to Switch from Firewood to Gas Fuel

John H. Y. Edwards and Christian Langpap
Land Economics
Vol. 81, No. 4 (Nov., 2005), pp. 570-586
Stable URL: http://www.jstor.org/stable/4129683
Page Count: 17
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Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.
Startup Costs and the Decision to Switch from Firewood to Gas Fuel
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Abstract

Firewood remains a key source of energy for households in developing countries, contributing to forest degradation and deforestation. The adoption of alternative fuels may be hindered by high startup costs, and this problem may be compounded by restrictions in credit availability. We use survey data to examine how credit access affects firewood consumption in Guatemala. Our results suggest that access to credit plays a statistically significant role in determining firewood consumption through its effect on the ability to purchase a gas stove. However, simulations suggest that these effects are small and that subsidizing stoves would be a more promising policy for reducing firewood consumption.

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