I test whether economic incentives impact peer effects in public-good settings. I study how a visible and subsidized contribution to a public good (installing solar panels) affects peer contributions to the same good that are neither subsidized nor visible (electing green power). Exploiting spatial variation in the feasibility of installing solar panels, I find that on average panels increase voluntary purchases of green power by neighbors. However, when subsidies to solar are high, solar panels reduce peer contributions. The results support the hypothesis that signals drive peer responses to visible public-good contributions and that economic incentives alter those signals.

We document how imperfect information generates heterogeneous effects in information treatments with personalized high-frequency feedback and peer comparisons. In our field experiment in retail electricity, we find that high- and low-energy users symmetrically underestimate and overestimate their relative energy use pretreatment. Responses to personalized feedback, however, are asymmetric. Households that overestimate their relative use and low users both respond by consuming more. These boomerang effects provide evidence that peer-comparison information programs, even those coupled with normative comparisons, are not guaranteed to lead to increases in prosocial behavior.